USDA shocked the market this morning as it projected the national corn yield at 153 bu./acre. Leading up the report, Jerry Gulke, President of the Gulke Group, says the market was trading yield expectations in the 155 bu./acre range.
They’ve recognized there’s a problem out there. I think they wanted to get ahead of it a little bit for fear of being criticized,” Gulke says. “They left the acres the same, but lowered the harvested acres by 500,000. What was interesting in the corn was they didn’t lower any of the acres in those four states (North Dakota, South Dakota, Montana and Minnesota) they resurveyed.”
Interestingly, the majority of the prevent planting in those states was in the Durum and spring wheat markets. Corn carried the spring in the traditional wheat markets of the northern plains.
Alan Brugler with A&N Economics, Inc. says the grain market traders are cautiously optimistic a cease fire or peace deal between the U.S. and Iran is near and took out war premium Tuesday.
Joe Kooima with Kooima Kooima Varilek says at least initially it looks like the cattle futures had already anticipated the negative report data with the sell off late last week.
Last week Jerry Gulke, president of The Gulke Group, predicted the highs had been made in the grain markets on May 13. After reading the White House fact sheet on the China trade framework, he says he hasn’t changed his mind.
