The snow and cold temperatures passing through the Plains the next few days continues to be a headache for corn while wheat benefits from the moisture and it is unlikely that temperatures will dip deep enough for long enough to deal damage to the crop at this stage of development. Duh! Tomorrow’s supply/demand figures are expected to reveal an increase in carryover in everything. We’ve traded that since the stocks and acreage reports last week. There might be a tweak or two in the international production figures and supply/demand projections yet, traditionally, this is a non event report. It would be a real surprise if we were surprised with any numbers tomorrow!
We’ll receive crop progress and ratings tonight from the USDA. They’ll be something to talk about but more interest might be given to the top soil and subsoil state reports.
The wheat spreads in Chicago still suggest that there might be some quality issues with the 53 million bushels of soft red presently in deliverable channels. We’ve had the contract which rewards storing non milling quality wheat for close to two decades and the septic system might be backing up a bit. Taking in poorer quality wheat, discounting it heavily, putting it out for delivery and receiving some very healthy storage income with the understanding that most stoppers cannot make a dent in loading out the deliverable inventory has been a winning strategy and will continue if we have a good quality new crop harvest. We have to play it out and it appears likely that we will have a decent quality crop. Yet, there might be some jitters ahead of harvest so that’s why, in the past, we’ve suggested that WN/WU and WZ/WU butterfly might be warranted.
Trade deals may be anti-climatic. Brexit may continue to be drawn out ad infinitum. At least the weather is real!
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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