The media is focusing on the soggy conditions in the northwestern quadrant of the corn belt and it does appear that we’ll have a difficult time getting the corn crop in on time this Spring if we get it in, at all! If we get it in the ground there’s abundant top and sub soil supplies to sustain it through any early hiccup hot and dry for a short time. So begins the growing season of the 2019/2020 crop!
We’re given the lowest winter wheat acres in decades. Spring wheat and durum land is damp and soggy right now yet, there’s time to see that change quickly. Corn is looking at similar headaches with planting. The USDA will issue its prospective plantings estimate next Friday and I will go out on a limb and say that the trade will be skeptical of these figures as Mother Nature has changed the landscape. Beans may become the redheaded stepchild and be the first to break and the last to rally as this crop is the planting of last resort and it may come down to that if we see a damp April.
What few winter wheat acres we have are enjoying the moisture. Yes, some fields may be a little too damp right now yet, we’re set up for a great yield given the moisture now all we need is hot and dry in the final few weeks of development and harvest. We need a good quality crop this year as basis levels still suggest that the stocks left(Stocks-in-all-Positions as of March 1 to be released next Friday) may not be the best quality. We need to watch the weather each and every day for the next 4 months to see how the 2019/2020 crop fares. Right now funds are saying that all is well and the producer will be relinquishing physical possession at harvest. It’s not really the time of year to be all that comfortable as we’ll be talking about winter ill, frost damage, fungal diseases given the dampness and other black swans like glume blotch and who knows what before we harvest.
Then there’s the macroeconomic aspect of the market with money supply and political happenings. Watch and wait for developments. We still see the microeconomics of the spreads a little more stable. Bean and corn spreads might remain sloppy and soft. Wheat still has the potential to be very firm in all classes depending on the weather.
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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