As December comes to a close, the grain markets are offering a few gifts. March corn prices were up 3.25¢ and new-crop December corn prices were down 4.5¢, for the week ending Dec. 17.
March soybean prices were up 14.25¢, and new-crop November soybean prices were down 2.25¢. However, March wheat prices were down 10.25¢, and July wheat prices were down 13.55¢.
A trend to watch right now is the spread between old-crop grain prices and new-crop grain prices, says Jerry Gulke, president of the Gulke Group. Currently old-crop prices are going up, while new-crop prices are under pressure.
“A lot of traders see that as verification that there’s a demand upfront,” Gulke says. “This is a positive development, but we need more than one week to have it happen. We need to see it turn out to be a trend after we come back from the holidays in January.”
The soybean complex is showing some interesting developments. March soybean meal was up around $10 for the week.
“If you look at the soybean meal chart, you’ll see a ‘V bottom,’ when it all of a sudden changed from being totally negative,” Gulke says. “Most of that was due to the lysine problem.”
In November, news reports came out saying China, a major supplier of the feed additive lysine, would no longer sell it.
“Lysine really helps with rate of gain in hogs, so all of a sudden meal caught fire again,” he says. “With increase crush due to renewable diesel, we were worried we’d have too much meal. But the lysine issue solved that, at least for now.”
While soybean oil prices are not as strong as they were, they are not sinking as fast either, Gulke says.
“Those two items can support the price of soybeans and it’s a good time to have that happen,” he says.
Gulke is also watching weather developments here and in the U.S., cattle prices and basis levels.
Check the latest market prices in AgWeb’s Commodity Markets Center.
Jerry Gulke farms in Illinois and North Dakota. He is president of Gulke Group. Disclaimer: There is substantial risk of loss in trading futures or options, and each investor and trader must consider whether this is a suitable investment. There is no guarantee the advice we give will result in profitable trades. Past performance is not indicative of future results.
