Some may be looking at the low temperatures forecast in the Central US this weekend as a concern for wheat yet we need to stay frigid for an extended time with the lack of snow cover/moisture to cause any winter kill…………………..Historically, we need to go into dormancy very dry and then get very cold in order to do any damage…………. The winter wheat crop has a lot of events ahead before it’s in the bin and the number one killer of wheat is drought….and we’re not in one! Heaving in the late Winter and early Spring is more of a concern/reality………..But, it’s nice to see the market with a pulse and reacting to anything fundamental is welcome! The trade consensus is that winter wheat acreage is down about 1 million acres from last year…………….some day we might get a figure from the USDA but we’ll be trading the weather from March to July regardless…………..Basis levels have floundered for a few weeks yet, we anticipate a little more firmness in the last quarter of the marketing year as quality is an issue in both the domestic and international markets….But, given comfortable carryover projections we do not anticipate anything substantial unless something of concern occurs with the new crop……………
Believe it or not, we are rapidly approaching the start up of field preparation for new crop corn and beans and the ratio is historically ambivalent so planting prospects will be heavily determined by the weather in April……………Until then we’ll be looking at the weather in South America and yield results from the harvest…………….Spreads have been dull and unexciting and might be expected to remain so……………Beans and corn in temporary storage could move a little more urgency as warmer weather arrives which may keep pressure on the nearby contracts as we approach March deliveries……………………
Government shut downs, central bank machinations, trade deals and civil unrest may be considered problematic yet they have and may move the markets……..We sense an increase in urgency by the powers that be to solve the crisis in the US, Britain and France in the next few weeks…………..Life is interesting!
The information contained on this site is the opinion of the writer and obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.
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Steve Bruce
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