Markets - General
It didn’t start with the swing of an ax in the Amazon or by an explosion in Kiev. Both contributed, but the shifts in global grain flows is a multifaceted prism through which the future is continuing to evolve.
The value of capital assets and cash flow were concerns in 2008 — just as they are today. The evolution of dealing with inflation has yet to impact ag directly, but history shows a wake-up call is in process.
There is now a dollar value assigned to grain carbon intensity scores below 29 in the form of tax credits to biofuel plants that buy grain as part of their decarbonization efforts.
Jon Scheve discusses the recent USDA report and shows how demand issues may impact corn and bean prices over the next few months.
Arlan Suderman, StoneX Group, and DuWayne Bosse, Bolt Marketing, debate USDA’s WASDE numbers.
Following the bearish report on Wednesday, grain markets closed higher for the week, which, according to Jerry Gulke, signals the market might believe there is more downside to yield.
After the June report, traders prepared for a “new” trading environment with “burdensome” corn supplies and “pipeline” soybean supplies. Then came the anticlimactic July report.
Jon Scheve discusses bean highlights from the recent USDA report and estimates where bean prices will go based upon different national yield averages.
The next opportunity for USDA to adjust its corn yield forecast is next week during the July WASDE report. Currently, USDA has penciled in a 181.5 bu. per acre national yield, but analysts think it may be too optimistic.
The National Drought Mitigation Center estimates 67% of corn and 60% of soybeans are still considered to be in drought, a slight improvement from last week when drought covered 70% of corn and 63% of soybeans.