By Ron DeJongh, Chief Commodity Marketing Officer
At Landus Cooperative, we work to bring you good news. This week, we've also been working to communicate the not-so-good-news as clearly and frequently as we can amid market pressures caused by coronavirus and oil prices.
Equity Markets: The COVID virus has caused significant losses in equity markets including the DOW Jones Industrial average as investors are concerned about the U.S going into a recession ( defined as two successive quarters of negative growth in GDP).
Bean Demand Positives:
- Grain futures are also under pressure with a large soybean crop in South America and U.S. dollar strength making Brazilian soybeans more competitive in the world market.
- The Ralston soybean plant crushes 80,000 bushels per day and continues to be a strong market for our members soybeans.
- We see good demand for soybeans in both domestic & export markets in the summer months and can receive them whenever farmers are ready to ship.
The Status of U.S. Corn: Corn prices are under pressure due to global issues as well; US corn is largely uncompetitive in the global market and ethanol producers are struggling. Much of this negativity is being driven by the crude oil price war between Saudi Arabia and Russia and that battle does not appear to be ending any time soon. The geopolitical issues and an overall reduction in gasoline demand means we do not see this issue resolving itself soon; we are hearing of some plants closing in the near term.
Your Cooperative: Landus Cooperative has an abundance of space to receive our members grain and is utilizing our excellent rail system to access domestic and export markets; currently we are shipping out at a pace of 8-10,000,000 bushels per month via rail.
As we all deal with uncertainties caused by circumstance outside of our control, Landus Cooperative stands ready to provide excellent service and market access for our farmer members to help them through challenging times.
Thank you for your business!