After months of grinding lower, market pops.
WOW! What other word could describe the past couple of weeks in the corn market? After months of steadily, slowly grinding lower, the CBOT finally found a bottom on Monday, May 13th.
Looking back on corn futures we saw…
- January had a narrow range, from the upper $3.80’s to the upper $3.90’s
- February also had a narrow range until late in the month; then down to the upper $3.70’s.
- March ebbed and flowed between about $3.70 and $3.90. USDA report day on March 29th, closing in the mid 3.60’s and losing over 17 cents that day.
- April was more of the same; monthly low April 25th at 3.51 1/2.
- End of April saw a mini-rally, with July futures climbing about 20 cents over seven trading days.
- Concern about planting progress was starting to be felt.
During all of this time, the prevailing talk was more about normal things missing from the market. A government shut down prevented many reports from being issued, and lack of an agreement with China continued to hang over the market.
Here in May, several days in a row of positive closes ensued as the market became more concerned with the date on the calendar, the lack of planting progress and the prospects for more rain events in the forecast. We saw many people take advantage of the rally and lay off some of their Old Crop and then more and more sales of New Crop as the rally continued. Much of this came through direct sales and several offers being triggered.
We added a one-day “Price Kicker” special for selling $4 for March 2020. Many responded. Make sure to download our app and TURN ON your notifications to get the alert for our next price kicker.
How to Manage In these Markets?
These types of markets are the exact reason you hear us talk so much about knowing your cost of production and using that to make sales or put in offers. The months of January and February lulled people to inaction. The shut-down, the bitterly cold weather, and the lack of fresh news just put a negative mood on marketing grain. All the rain in March stopped most thoughts of hauling grain from the farm. And then, when April arrived, most people tried to ignore the markets and focus on preparing to plant. But here we are in May, with most of the corn ground around us planted and being able to take advantage of the rally in the market.
Continue to keep an eye on the markets as we move through June and the inevitable concerns about pollination. Get those offers in place and let the market work for you.