1/28/19: Mark's "Market Talk" Blog

Government back to work, for now, markets react positively, Brrrr

It’s always good when you end a week on a positive note and Friday’s announcement that the government shutdown is fixed for at least 3 weeks provided the good news we needed. However at the end of the week corn was still down a penny and a half as the lack of news earlier in the week caused us to trade lower. Corn does have some positives working as export demand has been good, the private forecasters are backing off on the acre shift, and the prospect of China buying US corn. This doesn’t translate into a 50 cent rally but it may move us 25 cents. March corn has traded in a very narrow spread since the first of the year so it is time to break one way or another, right now I think it will go higher. The USDA announced Friday that the January crop report will be released on February 8. Perhaps this will give us some direction. Beans finished last week 7 cents higher. That gave us the highest close for March beans since last June.  My concern is how much China talk has been built into this market which may temper things when an official announcement is made concerning their ag purchases. The world is awash in beans so the chance of a big rally from here would seem unlikely. If we don’t switch enough acres from beans in the coming year our carryout will become even more burdensome. Finally we can talk about the weather. After a couple of years with few snow events it appears we are on the way to above snowfall. Every time it snows it gets harder to find room to push it out of the way. Now we are looking at a week of extremely cold temperatures that will add more misery.  I guess we chose to live in Iowa so we can enjoy all 4 seasons.

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