It’s been an exciting few days for grain trade with nearby corn futures trading over the $6.00 price resistance level. Soybean futures also enjoyed a dramatic technical feat with January through August 2022 futures contracts trading over $13.00!

Fundamentally, the continuation of dryer weather in portions of South America and strong grain demand is keeping grain prices firm.

While it might be tempting to want to shut off the markets for a few days to enjoy some holiday cheer, you can’t this year. Please stay vigilant. There are many reasons why grain prices would likely stay higher, but one black swan could swoop in and wipe out the recent friendly sentiment.

Here are four things that have my attention to monitor in the days ahead:

Basis potentially widening out

Based on recent conversations with producers, there is likely going to be a lot of grain sold in the coming days. Much of it is due to the recent rally, and some is because farmers have grain in the bin, time to move it, and a new tax year around the corner to reward with cash sales. With plenty of grain coming to market, that may widen out your local cash basis as elevators gain corn and soybeans in their possession.  

Geo-Political Drama

The world continues to eye Russian President Putin and his aggressive approach of the Ukraine border. Experts have suggested that Putin would not be ready to invade Ukraine (if that is indeed his end game) until early February, however some are suggesting he could be ready to invade sooner than that.

Related:The 9 grain market indicators to watch, now through the New Year

Let’s hope cooler heads prevail and world peace occurs for Christmas.

But I do find it curious that President Biden is not heading out of town for the Christmas holiday. Surely a trip to his home in Delaware would be on the to do list, but apparently not this year. It was just announced that he is staying in Washington. Perhaps to keep in better position to monitor global events?

Human and livestock health - Omicron and African Swine Fever

Omicron continues to spread. Various forms of lockdown or new masking mandates are starting to creep up around the world. Sometimes these lockdowns arouse fear in the market, and fear selling then pushes prices unexpectedly lower.

Currently, African Swine Fever is NOT in this country. The pork producers of the United States need to be thanked for this, along with the tremendous efforts of those taking safeguards to make sure it does not enter our country. Many thanks and hats off to you. African Swine Fever has been located in the Dominican Republic. One thing in the back of my mind is that the Caribbean is open for business, and cruises and cruise travelers are island hopping. While no one would ever wish for African Swine Fever to arrive in the United States, just be mindful that if it did, that would significantly hurt grain demand for feed, which would likely drop grain futures dramatically.  

Related:Three simple marketing strategies for corn into year end

Light trade volume and three-day holiday weekend

The markets are closed on Friday this week for Christmas Eve and Christmas. Volume over the holidays and between Christmas and New Year’s can be traditionally lighter as traders and market participants take vacation. Sometimes when volume is light, and participants are not around, one big order or one big piece of market news can move the market more than normal.

Remember, marketing is how you get paid for your hard work. While the outlook and technical charts for the grain markets is currently friendly, just be mindful of what pieces of news could potentially rob you of your holiday cheer.

There are so many moving parts to the market this year. Please stay vigilant over the holidays.

Reach Naomi Blohm: 800-334-9779, Twitter: @naomiblohm and [email protected].

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