For the week December corn was down 6 cents, March corn lost 6 ¾, November soybeans dropped 11 ¼, January soybeans fell 13 2/4, December soybean meal fell $3.60, December bean oil lost 8 points, December soft red winter wheat was down 16 ¾, December hard red winter wheat fell 14 and December hard red spring wheat dropped 9.
Grain and oilseed markets were down Friday and for the week after escalating trade tensions between the U.S. and China resulted in President Trump scraping his meeting with Chinese President Xi at the end of this month.
With No China Deal Will Corn and Soybeans Retest the Lows?
Jerry Gulke, president of the Gulke Group, says the trade news was a game changer for the market.
After calling an early low in the corn and soybeans, he says Friday’s news and trade action has changed his opinion and he has turned bearish.
“I don’t think we’ll go back and test the lows, but we may very well go back and test those gap areas,” he says.
Farmers Will Need to Settle for Aid
Gulke says President Trump showed his hand with Friday’s negative trade developments and so he thinks farmers will have to settle for a trade aid payment from the government rather than getting their income from better grain market prices tied to a China trade deal.
“When you’re dealing with politics and especially this president who is, you know, leaves us kind of guessing, that makes it a little more difficult. And I think today was the final straw that convinced me that we’re talking about solving our problems on agriculture with a check again and you can do that with $20 billion probably,” he estimates.
He also expects President Trump to push more policies that will support domestic demand, including biofuels.
“I think we kind of proved we can do without China in the corn and now we got to do it in the soybeans and the answer is there. It just takes the President’s signature,” he adds.
Gulke Mitigates Risk
Gulke says they were flexible this fall and decided not to store grain on the farm because his operations has scaled down to less than 1,000 acres and he can re-own the crop on paper.
He says for their client they tried to get ahead of the collapse in soybeans and mitigate risk.
“We decided Thursday to sell all the beans that we had an open storage, so 100% of our beans are gone. If you can’t store them on farm, and if you’re storing them on farm, then you need to do some capturing a carry, which means you need to be short some July futures, at least something so those grain bins don’t become a graveyard for the grain,” he explains.
Many producers, according to Gulke, are undersold as they’ve been storing and waiting for a rally tied to a possible China deal, but he says both corn and soybeans had sell signals on the charts again on Friday.
“Before the crash right after the open we advised guys to get everything sold in the soybeans that they couldn’t store and price it and they did that.And then we also sold 20% of our corn that was hedged we put into cash contracts, whether you were storing it on farm or off farm, but mainly for the off-farm folks, it just doesn’t pay to store it,” he says.
Gulke says the cash market did not provide any opportunity as the local elevators had a wider basis for January for both corn and soybeans than at harvest.
“In other words, my cash price for January delivery wasn’t much better than what it is now. And they want to charge me $.22 to $.37 a bushel to store it.You could tell there was a hesitancy that something was going on there,” he adds.
So, he says they made more corn sales by selling July futures, selling December futures and even increasing cash sales for hedges in 2026.
“We’re pretty well covered.I don’t like the prices, but I know the risk that is out there, and the risk is just too great,” he says.
For more information contact Jerry at info@gulkegroup.com.
