You wouldn’t think a European firm’s downgrading of Spain‘s financial rating would have anything to do with corn prices in the U.S., but markets reacted instantly today, says Jerry Gulke of the Gulke Group. “Traders sold crude oil, and corn immediately followed it down. Corn lost about 60% of the gain we accomplished for the week.”
Traders just don’t have anything to capture their focus right now and are grasping at straws trying to earn a few cents out of the market, he explains.
“News from China continues to be encouraging. It doesn’t seem that there has been any change in availability of internal supplies—in fact, prices have risen slightly in China,” Gulke says. “So they may continue to buy.”
Next week, watch USDA’s Crop Progress report Tuesday afternoon. “Here we are at June 1 and we’re not done soybean planting. On my farm in North Dakota, this is the first time that none is planted yet. I think we could see as many prevented plant acres as last year. And farmers learned from last year—they’ll just stop so they don’t end up with immature crops in the fall.”
The other known factor later next week will be the “Goldman Roll” as that fund sells the nearby and buys back in the next month. That factor hasn’t brought big price changes recently, however.
Both classes of winter wheat ended limit up on the day as USDA shocked the market with their aggressive production cuts in the May WASDE according to Arlan Suderman, chief commodities economist, StoneX.
Agronomist Phil Long explains the critical gap between air and soil temperatures and why the “heat engine” for corn and soybeans has stalled in some areas.
China is unlikely to increase soybean purchases beyond existing commitments, but markets expect new deals for corn, sorghum, milling wheat, poultry and meat.
