The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
The FBN Team provides a macro-focused daily view of the world’s grain markets. Kevin McNew received a bachelor’s degree from Oklahoma State University and his master’s and Ph.D. degrees in Economics from North Carolina State University. He spent 10 years as a Professor of Economics with the University of Maryland and Montana State University focusing on commodity markets and is widely regarded for his ability to boil-down complex economic situations into easy-to-understand concepts for applied life.
Basis levels firmed 2 cents on average across the country for both corn and beans this week. The tailspin in the board should keep farmer selling limited and cash basis firming into First Notice Day next week for July futures.
On the river barge, rates were down significantly to start the week which helped push terminals to raise corn basis by 6 cents and soy basis by 4 cents. However, heavy rains in the Upper Midwest is starting to find its way into the Upper MS river and caused a shutdown in barge traffic on Thursday with the potential for a week closure.
Processors didn't seem to work too hard to attract bushels this week. Gains at corn and soy plants were mostly in step with US average changes. Ethanol margins are not lighting up the balance sheet for processors so it seems they will mostly be followers in the market. Not true for soy plants which continue to be enriched with record high margins. They should keep their bids firm through the summer. Feed buyers especially in the Central and Southern US continue to bid for bushels with good premiums stretching out to Aug delivery.
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