Mark's Market Talk

May 30, 2023

We saw a big reversal in the markets late last week as the 10-day forecast remained hot and dry. July corn ended the week 50 cents higher while the December contract was 35 higher. July beans were 30 cents higher while the Nov contract closed 14 cents higher. We could talk about 6 different things that influenced the market last week, but one word sums it all up: Weather. The funds had gone short the corn market the past 6 weeks as China cancelled orders and planting progress here was record fast. The USDA put out a record 181.5 yield in their May WADSE report along with a 92-million-acre corn planting. The areas in the northern plains that we all thought would not get planted this spring are drying out and getting planted. Now it appears there will not be a lot of prevent plant acres which will add production. Most of the corn belt is seeing great emergence as there has not been many pounding rain events. With everything going so good why did we shoot up so strong last Friday? Again, the simple answer is weather along with a 3-day weekend. 3-day weekends scare the living daylights out of traders. That extra day of no trading can be very expensive if you are caught on the wrong side. Therefore, we saw a quick rally take place Friday. The market opens back up on Monday night this week and chances are it will be explosive either up or down depending on updated forecasts. We just as well be prepared for a summer filled with wild markets.