Let’s start with the outside markets. The Dollar specifically. The dollar is exhibiting strength. This strength should continue. This has a profound effect on the ag sector. Especially beans at present. It is no secret I am bearish the soy. The markets are oversupplied. And this will continue. It is my belief the meal too is overvalued and the market will start to reflect this. The planting is moving along. Informa estimates 400 t more bean acres. More corn as well. The Chinese have no reason to purchase US soy at present. Regardless of what is worked out with trade details. Rallies from these conversations are opportunities to hedge in my opinion. We still have beans well over $10.00 with a 500 plus carry. Tell me when this was the case in the last 30 years. The crush is running high. This is actually a factor that will weigh on the products. The demand needs to be record given the global crush. The commercial is really printing money.
The Corn is getting a nice boost given the calendar. The progress was further along but the market is focused now on a yield drag due to the date. Also, the Brazilian crop continues under stressful fundamentals. Look for the market to retest recent highs. Further wet weather will push the market higher.
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” HE WHO DOESN’T RISK, NEVER GETS TO DRINK CHAMPAIGNE ” – RUSSIAN PROVERB