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Market Analysis



Understanding how to capture market carry

This week the USDA report and the markets were uneventful. Farmers aren’t selling and corn export demand is pacing slow. Good weather conditions in South America eroded bean market premium.   Understanding how to capture market carry I recently attended a grain marketing conference where the presenter discussed ideas for …

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Don’t give your storage away

The markets continue to go nowhere. Corn exports are pacing slower than what USDA is forecasting but farmers aren’t selling. Beans earlier seemingly had upside potential due to South American weather, but couldn’t sustain it. Beans still have some potential in the short term if there is a weather scare in South America, …

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Capturing market carry

With too much supply in the U.S. and around the world, corn isn’t likely to move in the short-term without a big event. With 30 to 45 days of the major soybean producing areas of South American growing season left, there is still a lot of weather premium potential left …

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Straddles vs. accumulator contracts

The USDA announced a record yield resulting in a 2.5 billion bushel carryout. Therefore, I think it’s unlikely that corn will sustain a major rally until summer 2018. A soybean rally won’t help corn prices either unless there is a devastating drought in South America. If there is a 2 …

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Selling calls

The markets didn’t move much this week. Harvest pressure continues to limit corn upside potential. Beans at first looked like they may take off as harvest slowed, but on Friday, Brazil’s currency fell against the dollar. This meant a price boost for Brazilian farmers who sold some beans, putting pressure …

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Benefiting from puts, calls and straddles

Corn The market continues to be uneventful. End users want to buy $3.40 Dec futures and farmers are hoping for $3.60 to sell some excess production. Slow exports aren’t helping. Realistically farmers may need to plant 1 million to 2 million fewer acres next year to see $4 by next …

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What is in your marketing tool box?

While the slow harvest is keeping corn prices from tanking in the short-term, the inevitable huge supply is limiting any upside potential. The latest USDA estimates haven’t helped either. While they reduced acre estimates, yields also increased. So, there was little price impact. It’s doubtful that even a South American …

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The dreaded margin call

The market is boring right now because there is nothing to talk about.  Corn seems to be range bound between $3.45-$3.75 until Thanksgiving and it will take an unforeseen surprise to change it.  Beans seem range bound between $9.40-$10.00 through November.  For that to change, it will take a big …

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