July 1, 2019: Mark's Market Talk

July 1, 2019

The USDA took the wind out of the corn market Friday when they released the June acreage report which showed corn acreage at 91.7 million acres while the average trade guess was 86.66 million. So the number one question is who’s right? The USDA announced an hour after the report came out that they would resurvey, but those numbers won’t be released until the August 12 report. Meanwhile farmers feel like they have been sucker punched. We have just been thru the worst planting season on record where most of the acres that did get planted are behind and suffering. In their announcement the USDA said their report was based on both planted and intend to plant acres. There is a strong possibility that a lot of the intended acres didn’t get planted. Even if those acres did get in the ground it was late planted into less than ideal conditions. The trade will have to make up their own mind about what numbers to use. At the close Friday December corn was down 19 plus cents. For the week Dec corn was down 21. Beans received a bullish acreage number as the USDA projected 80 million acres of beans either planted or intended to plant. That was over 4 million less than the average trade guess. November beans were 11 cents higher Friday while they ended the week down 4 cents. The stocks part of this report was mildly friendly to both corn and beans. I anticipate farmers will continue to be slow sellers of old crop which will force basis levels higher yet. Most of the producers will now hold any old corn they have left thru pollination. During the weekend Presidents Trump and Xi met and agreed to temper the trade war while both countries come back to the table for more discussions. This appeared to be a polite way to address the situation without placing blame on either party. The grain traders have heard this song before so it is doubtful they will get excited until we see some real announcements concerning agricultural trade. The weather has turned hot as we approach the 4th of July. With the long and somewhat late pollination of corn this season heat and dryness might combine to move the corn market higher. Or we may amble thru the month of July with average temperatures and rainfall. We know what today’s hybrids can do if given a fighting chance.

Posted: 7/1/2019 5:00:00 AM by Rob Matherly | with 0 comments