Farm Progress

Corn marketers hoping weather reports stops tumble

All eyes are on the USDA's monthly supply and demand report out due June 12.

Kevin Van Trump

June 11, 2018

2 Min Read

Corn prices have tumbled by more than -30 cents in just the past 12 trading sessions. Bulls are hoping that weather headlines out of the Black Sea region might help stop some of the recent bleeding.

From what I understand, dryness in parts of Russia has intensified a bit and the drought might widen and worsen during the next couple of weeks. Meaning yields might start being trimmed more aggressively and the market might want to add a little risk-premium on the news. As for Brazil's second-crop corn, it feels like things have stabilized. It ill be interesting to see what the USDA has to say about both the Argentine and Brazil production estimates in tomorrow's report.

Here at home, the trade is considering some abnormally high temperatures, but it sounds like they were fairly limited to the Plains. I still hear talk of dry conditions in parts of Missouri, Illinois, and portions of the Delta. Unfortunately, with the current crop-condition rating showing one of the best starts we've seen in years, it's tough to convince the trade that there's any reason to be concerned. I'm hoping the ratings in some states start to pull-back a bit to reflect more realist conditions. I'm just not seeing it as good as they are in some of these areas and believe overall conditions should come down a bit.

As for tomorrow's USDA monthly supply and demand report, South American production estimates will be in play, as well as forecasts for U.S. exports, ethanol and feed usage. As a producer, I'm staying extremely patient. End-users should be using the break in price to secure some additional supply. As a spec, I like the thought of building a conservative longer-term bullish position. 

 

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About the Author(s)

Kevin Van Trump

Founder, Farmdirection.com

Kevin is a leading expert in Agricultural marketing and analysis, he also produces an award-winning and world-recognized daily industry Ag wire called "The Van Trump Report." With over 20 years of experience trading professionally at the CME, CBOT and KCBOT, Kevin is able to 'connect-the-dots' and simplify the complex moving parts associated with today's markets in a thought provoking yet easy to read format. With thousands of daily readers in over 40 countries, Kevin has become a sought after source for market direction, timing and macro views associated with the agricultural world. Kevin is a top featured guest on many farm radio programs and business news channels here in the United States. He also speaks internationally to hedge fund managers and industry leading agricultural executives about current market conditions and 'black swan' forecasting. Kevin is currently the acting Chairman of Farm Direction, an international organization assembled to bring the finest and most current agricultural thoughts and strategies directly to the world's top producers. The markets have dramatically changed and Kevin is trying to redefine how those in the agricultural world can better manage their risk and better understand the adversity that lies ahead. 

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