Mark Gold: Political Issues that Could Impact the Grain Markets

Farmers need to learn to balance the risks of their grain marketing decisions. For example, if you sell grain early, replace those cash sales with call options.
Farmers need to learn to balance the risks of their grain marketing decisions. For example, if you sell grain early, replace those cash sales with call options.
(Top Producer)

Could 2022 offer the same profitable opportunities as 2021? The outlook for corn and soybeans is optimistic thanks to strong demand and potential production shortfalls in South America. Yet headwinds are present. We asked eight analysts to provide their best estimates on price direction and market strategies you can put to use in 2022.  

Mark Gold, Top Third Ag Marketing

Markets continue to evolve. I am watching:

  • Weather around the world. With carryouts relatively tight in most commodities, having decent crops in South America and in the U.S. will be critical. 
  • Demand’s influence on prices. In the past several months Chinese buying has been light in soybeans. 

In 2022, there is concern on two political fronts. First, a possible Russian incursion into Ukraine would cause disruptions in the wheat trade. 

The second possible issue is if the Chinese invade Taiwan. I would imagine this would cause the U.S. to impose some kind of sanctions against the Chinese, which would be an issue for the soybean and corn market. 

Farmers need to learn to balance the risks of their grain marketing decisions. For example, if you sell grain early, replace those cash sales with call options.

Prices are now above breakevens on corn, wheat and soybeans. I would aggressively protect these prices now. If you sell grains, re-own with call options or buy put options to protect the downside. I would use cash sales protected with call options or buy put options to protect the downside. 

 2022 Bull Bear Outlook

Read More

Naomi Blohm: Corn and Soybean Market Factors to Watch

Bill Biederman: A Dichotomy of Possibilities

Brian Basting: Market Tools That Turn Uncertainty Into Opportunity
 


Disclaimer: This material has been prepared by a sales or trading employee or agent of these analysts and is, or is in the nature of, a solicitation. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions and agree that you are not, and will not, rely solely on this communication in making trading decisions. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that these analysts believe are reliable. Such information is not guaranteed to be accurate or complete, and it should not be relied upon as such. Trading advice reflects good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice provided will result in profitable trades.

 

Latest News

Think Inside The Box To Solve Problems On The Farm
Think Inside The Box To Solve Problems On The Farm

Kyle Scheele shares six ways constraints can be a good thing to your operation.

DOE Rejects API Appeal on LNG Export Suspension, Ensures Review Continues
DOE Rejects API Appeal on LNG Export Suspension, Ensures Review Continues

The Department of Energy (DOE) has declined a request by the American Petroleum Institute (API) and others to lift the suspension on new liquefied natural gas (LNG) export approvals.

Oil Testing Offers Value: Like a Blood Test for Tractors and Combines
Oil Testing Offers Value: Like a Blood Test for Tractors and Combines

Oil and fluid testing answers both short- and long-term questions about the internal condition of engines, transmissions and hydraulic systems.

Airplane
Still Waiting on SAF Announcement

While the White House aims to boost production of SAF, it has faced challenges in defining rules for tax credits, particularly for crop-based forms of the fuel.

Corn Prices Higher After USDA's Bullish Reports, Soybeans Flat: Where Do the Markets go Now?
Corn Prices Higher After USDA's Bullish Reports, Soybeans Flat: Where Do the Markets go Now?

Grains end mixed with strong gains in corn in reaction to USDA's 90 million acre estimate and lower than expected stocks. But how much higher can corn go? Garrett Toay, AgTraderTalk, shares his thoughts.

Where Did All the Corn Acres and Principal Crop Acres Go? The Two Biggest Questions from USDA's Big Prospective Plantings Report
Where Did All the Corn Acres and Principal Crop Acres Go? The Two Biggest Questions from USDA's Big Prospective Plantings Report

USDA says farmers intend to plant 90 million acres of corn this year, which is lower than the trade expected prior to USDA's big Prospective Plantings report.