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Shhhh. We should probably be quiet about it for fear of jinxing it, but it would appear that the corn and wheat markets are on track to close higher for a second week in a row. This is something these markets have not been able to accomplish at least since early December. If we wrapped up trade right now, for the week, May corn would be up 6-cents and July wheat 7-cents. You probably already noticed that I did not add beans into the mix as they have not fared quite so well and if we close right here, May futures would be down 1-cent. There appears to be a growing recognition that, even though the calendar may be telling us it is spring, the actual weather conditions have had something different in mind. Combine this with the fact that much of the Midwest experienced a wet fall and less than normal tillage work undone, and the bear should have reason to be feeling a might uncomfortable. As I mentioned early this week, funds have accumulated record short positions in corn, which seemed an improbable time of year to do so, and it would appear they are on the path to lightening the load.
Another ill effect of the massive flooding in Nebraska and surrounding states has come to light, as it has brought the ethanol industry to a standstill in the area. Even if the plants were not impacted directly by the flooding, the crippled infrastructure has stopped or limited the flow of grain, both via truck and rail. It is estimated this has idled around 13% of the nation’s ethanol production capacity, and of course not good news for overall corn consumption.
Nothing new to really report on the U.S./Chinese negotiations. As reported earlier this week, the top U.S. people are headed for Beijing next week to try and work out the remaining sticking points, and there is already discussion that the Chinese will be back in Washington the following week if need be. There are semi conflicting stories from officials yesterday as Ag Secretary Perdue comment that the Chinese attitudes were “hardening” on some issues, but during an interview, President Trump stated that the trade deal is moving forward and will probably happen soon.
There was a sale of 300,000 MT of corn to China reported this morning.
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