There’s still over 50% of the corn and bean crops to harvest and store and it does look like Mother Nature will present the opportunity to make a lot of progress as the 6 to 10 day forecast from the National Weather Service is calling for cooler and drier than normal conditions……………………….Winter wheat seeding is close to the 5 year average at 65%……………………..
Spreads and basis might remain on the defensive for corn and beans as harvest progresses………………….I am still a believer that wheat spreads will tighten after we deal with December deliveries as domestic stocks are more than sufficient and wheat will spend the winter in Toledo but, international stocks are forecast by the USDA to be on the light side and deliverable stocks might be very desirable in March/April/May next year ………………Flat price remains supported because we are near the lows of the decade but, rallies may be muted as our Federal Reserve pursues a monetary policy of quantitative tightening………………………………………
End users appear to be more than willing to add coverage sub 360 CZ and 850 SX and 500 WZ………………..Producers might be more than willing to hedge new crop production at $6 WN, $10 SS and $4.20 CT…………………….It appears that we might just get comfortable within a tight trading range for a few months…………………………..We’ll be dealing with November bean deliveries and then the end of the month………………Open interest has room to grow yet, we need a reason to move the market …………………Patience!
Trade pacts and agreements, specifically with China, have taken center stage in the grain world and talks and actions may escalate after the midterm elections and more is known about the bargaining power of the President ……………………The G20 meeting in late November might serve as the background for a new agreement…………………………………………………………..
We’ll get another crop production report before this event and there are some analysts who believe in another shooter on the grassy knoll, Illuminati and faked moon landings that the October production and yield figures were stymied and/or massaged for whatever reason they want to believe………………………………We continue to hear field reports of excellent yield in the eastern half of the corn belt for corn and beans while the western half has had a few instances of less than stupendous results…………………………….The basis will let us know where the truth rests!
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.
Steve Bruce
Walsh Trading
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