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.
We’re at that part of the growing season in the Heartland when we can see the finish line and can make a good corn and bean crop great if Mother Nature continues to cooperate through harvest. In my view we are also at that point in the season when the pest and disease problems start getting more attention and in a typical year we can see local tragedy and devastation yet, a widespread major event is seldom seen. To me that situation has been “buy the rumor, sell the fact”. In years past we’ve experienced remarkable results in beans when rains come in the last few weeks of August. In my opinion the trade is awaiting the moisture expected this weekend. We could potentially see a reaction Sunday night/Monday with the market pricing depending on the arains received.
I think one has to deal with today’s circumstances and situation regarding trade and it affects supply and demand. In my view we also have to look ahead to what’s ahead for next year’s crops, 2019/2020, and a snap shot of bids for the upcoming year shows that beans are 2.3 times the value of corn while wheat is still vibrating around $1.90 to $1.95 over as of the close on 8/14/18. Traditionally these values with these lead times suggest to me more wheat seeding and less corn and full season beans. Per data form the USDA, since 1980 we’ve seen wheat acres in the US slip from 81 million acres seeded while European production has increased due to a number of factors. In my view the increase in the former Soviet Union is the most significant. In my opinion the price incentive is present in wheat to gear up for increased acres this Fall.