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Well, that was certainly a rather unpleasant and unwelcome surprise. In deference to pretty much everyone else who has been out conducting crop tours and field checks, the USDA has told us that the 2017 growing season will have a negligible effect on yields this year. At 169.5, corn is projected to be right on top of their projected trend-line and with beans pegged a new record of 49.4, were of course above trend-line. The production maps that accompanied the report would appear to accurately reflect the trouble spots in our nation along with the success areas; it is just the degree for each that was the surprise. While I suspect, we will see further yield reductions in the months ahead, unfortunately in the meantime we have been pushed into a deeper hole from which we need to claw back from. The good thing is, the market does tend to have a rather short attention span and within a day or so we should be refocused on something new again.
Looking around the world of markets this morning, it would seem that we are witnessing discouraging trade in all but a few select markets. Were we to close right now, December wheat would be down 15-cents, December corn 9-cents, November beans 14-cents and December cotton looks set to lose over 2-cents. Nearby hogs should eke out a minor gain but cattle are down over 6.50 a cwt., crude oil has lost just over 80-cents, the US Dollar would have lost 24 basis points and the S&P 500 is down over 40-points and suffering one of the harshest setbacks in nearly a year. The one market that is enjoying strength is gold, which is up challenging the highs of the year. If you had not suspected it already, what has unsettled all trade is the unrest that currently surrounds the situation in North Korea. No one likes uncertainty and when you throw in an element that contains radioactivity and the possibility of nuclear war, no one should feel comfortable. We can hope that over the weekend a bit more stability and peace has been restored.
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