Mark's Market Talk for May 29, 2024

May 29, 2024

We saw higher closes across the board last week for the 3 main grain commodities. Wheat led the pack gaining from 41 to 59 cents depending on the type. Russian weather was a big reason as frost scares are raising concern that Russia will have a short crop. This in turn moved the July corn futures 12 cents higher. Possible planting delays in parts of the mid-west is also giving corn a reason to rally some. Export sales continue to be strong for corn as we currently have the best price and supply in the world. For some reason ethanol usage has been weak. Evidently people are not driving as much so gasoline sales have been weak. The bean market acts like it may have found a nearby bottom, but we have thought that a couple of times this spring. China is being real slow switching their bean buying to the US. The late harvest in South America has stretched out longer than normal due to wet weather. It has not cost them as much yield as some thought it would so they are capturing some of the Chinese business that would normally be coming our way this time of the year. Old crop corn basis remains on the strong side as producers are still being slow to sell. The trade knows there is still a large amount of corn to come in and they will make sure it is not overvalued when that happens. Interior bean basis has softened as the export market has been extremely slow which is making more beans available for the domestic crush. I can’t say with certainty that a summer rally won’t happen, but I think it is probably time to part ways with most of the old crop grain you have been holding and if that rally does occurs sell new crop into it. It is normally not a good idea to own 2 crops and that policy doesn’t look like it will change this year.