AG TIME – Report Thursday

John Walsh General Commentary, Grains Leave a Comment

The USDA report tomorrow could be important. The markets are easing a bit into Thursday. I have covered the fundamentals as I see it over the last week. The numbers are off the charts huge. That most likely won’t change. The probabilities are a .5-1 bu to the acre increase. This coupled with the declining exports will equate to a 900 million plus carry. We had 250-300 2-3 years ago. These are not normal numbers to overcome. The analysts I see are talking about if China comes back. If this, if that. It is irrelevant.  Once these carries get this big it takes some years to work them off. It is my contention we are changing the global structure here and have maxed out growth for a while. The IMF is predicting contraction next year. When a nation (China) slows, the eating habits do as well. I believe we are witnessing this.  The new crop beans nov 19,broke today. This could be the start of a down here. After the numbers are confirmed for next year, the market above 9.00 could look rich.

The Corn is so lackluster. I have been friendly and still think the corn may be in an uptrend. The demand part of the equation is all positive. The President e15 announcement could have been met with more market excitement. THE PROBLEM is the yield has continued to increase. The corn carry is not as burdensome as the beans. But, still remains ample and nothing to get the market excited. Tomorrow could offer the same doldrums or a slight surprise could be the spark the market needs. There are short dated calls for cheap tonight. Quantifiable risk for the optimist at heart. As they say hope springs eternal. Lets see what tomorrow brings.

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