Market Analysis

Markets watching as planting season gets rolling

Weather will once again dominate grain markets for the next three months. The U.S. Climate Prediction Center is not currently seeing an active El Niño or La Niña. It is extremely important to monitor for that activity. The Center does see increasing odds for an El Niño in the Northern Hemisphere by late summer or [...]

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flooded corn

A look at factors that have a big impact on farm profits

Beans The Tuesday USDA report surprised many with an increase in world bean stocks, making levels the highest in history. With stocks to use rations also very high (third highest ever), conditions are not bullish and significant rallies are very unlikely. To put this into perspective, current U.S. stock levels are more than double levels [...]

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1255 Early Riser Planter with Precision Planting_0341_07-14

A lesson in “risk off hedging”

Weather forecasts are favorable for planting the next two weeks, so the market is expecting the 2017 corn will be planted easily. This news combined with positive long-term forecasts means the market is pulling back some, suggesting the possibility of another record corn crop. Funds reduced their length in bean futures and increased shorts in [...]

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Smokey bear

Corn, soybeans, and wheat bearish

Higher corn and soybean production in Brazil is bearish. U.S. corn ending stocks unchanged, soybean ending stocks up 10 million bushels, wheat ending stocks up 30 million bushels. Watch the close in relation to noon time price activity. Before the report corn was unchanged, soybeans down 5 cents, wheat unchanged. Shortly after the report corn [...]

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farm land at planting

Running the farm like a business

On Mar 31st (11AM CST) the USDA will announce the 2017 US planting intention estimates. Arguably, this report could have the biggest impact on the market in 2017. Until next Friday, there is little else to talk about. Many are expecting estimates of 91 million corn acres and 89 million bean acres. If the report [...]

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soybean

The difference between a speculator and a farmer

The South American harvest is expected to be a record with few shipping problems. Expect the market to be range-bound until March 31, when U.S. planted acre estimates are published.   Market action With few South American harvest concerns, I moved some of my bean hedges, which were originally placed anticipating a South American production [...]

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image001

Capitalizing on wish orders

The Thursday USDA report, as expected, held few surprises. The bean yields in South America continue to grow and could weigh on prices down the road. News of bird flu outbreaks concerned traders this week. It’s still uncertain how widespread the disease will be, so the market is a little shaky. A widespread outbreak would [...]

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corn4

Capitalizing on a sideways market

Rumors of changes to the Renewable Fuel Standard (RFS) mandate last week shook up the markets Many question if the rumor is valid, because changing the mandate would require an act of Congress, which is not a guarantee or fast process. Regardless, this rumor is viewed as “uncertainty” to the market. With corn around $3.75, [...]

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Heitkamp Farms Feeding Farmers Corn Harvest Combine

Capitalizing on the basis

There is a lot of unsold corn in farmers hands. Some estimates indicate only 40% to 45% of the 2016 crop is sold. With 16% carryout, there is plenty of supply available for the remaining seven marketing months. End users aren’t desperate for corn. Despite the abundant corn supply I think corn futures have upside [...]

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Grain bin sunset 1-6-14

Something is not adding up with carryout and prices

This week last year versus this year: Corn futures: 2017 — $3.70 2016 — $3.65 Carryout 2017 — 2.3 billion bushels 2016 — 1.7 billion bushels Something doesn’t add up. Basis has continued to slide lower and lower. Values are about 20 cents less than last year at this time, possibly adjusting to the irrational [...]

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