The projections are starting to flow from the USDA conference. The estimate is for a 4 million acre decrease. I don’t see it. A major university AG department just published a paper stating that the price relationship between beans and corn do not warrant an acreage shift of any quantity. My sentiments. Time will tell. I believe less than half or approx 1.8 million acres will be shifted. This is not bullish beans. We rallied today again on optimism that the US will supply more beans to China. Who will be taking less in general. This also leaves the door open for more weight on the global market as the southern hemisphere will be priced much cheaper than US, with larger stocks. The crush pace remains at or near record 182 million bu. The crush margins (board) are at 97 cents. Another wacky reality in a built up market, in my opinion. Leaving oil share at 33.1%. I believe ultimately crush will come a falling. When is the question. We have never seen global stocks or domestic stocks like this.
The corn came roaring back. Even with the projected increase in acreage. (which I don’t believe) the US stocks could decline to 1.5 bil or less. If I am correct regarding acreage, a carry of 1.3 billion is possible. A weather problem and corn will look cheap. The nearby needs to close above 382 and the tech trade may be back. The corn has the story if anything does. A few things need to materialize. As always quantify a risk. The Chinese buying would be a big part of the equation. It would be important to note this aspect is not baked into the numbers.
To discuss call 800 993 5449 or email jwalsh@walshtrading.com
” OUR MINDS BECOME MAGNETIZED WITH THE DOMINATING THOUGHTS WE HOLD IN OUR MINDS, AND THESE MAGNETS ATTRACT TO US THE FORCES, THE PEOPLE, THE CIRCUMSTANCES OF LIFE WHICH HARMONIZE WITH THE NATURE OF OUR DOMINATING THOUGHTS ” NAPOLEON HILL
BE WELL