The market showed follow-through strength last night after yesterday’s big day (corn was up over a dime while soybeans were up over 20c) but that has started to fade just a bit this morning. Of course, the market is still trading off of the weather forecasts: hot and dry in Brazil right as they enter the pollination window for corn, and annoyingly cold here in the U.S. right as we are wanting to plant it.
Remember, in the background our corn and soybean markets are still looking for more acres. The market has a job to do and that job is proving challenging as the acres that seem “available” are in areas of the country that are REALLY dry (North and South Dakota, for example). If those are the type of acres we are adding, penciling in a trendline yield someday will be a tough sell.
A lot can change in a short amount of time; a year ago today, soybeans and corn were roughly $5 & $2 per bushel less (respectively) than they are now, with the driver being newfound Chinese demand. In the midst of all this weather-market noise, it could be helpful for us all to remember that this rally was demand-driven and the goal of the market’s prices today is to get that demand to go away. High prices cures high prices, right?
There is a lot of time between now and harvest with what is likely to be a very volatile market, buckle up.
Corn is steady to a couple cents higher
Soybeans are steady to a couple cents lower