As we move from July into August, the focus of the market will move from corn yields to soybean yields. August will also feature the first estimate by USDA on the yield of this year’s corn and soybean crops. There will be a number of field days and crop tours that will be assessing production as well. Jim Bower, with Bower Trading, says, as we start the month, traders are still watching the weather, “The market thinks things will be a little status quo for a while. The weather forecast out through the 11th of August does not show any major stresses on the crop, although these outlooks can change very rapidly.” He added that August will be a time to pay very close attention to changes in the weather and market direction.
Bower says getting a handle on yields will be difficult this year because of the extreme variability of crop conditions across the Corn Belt. Another factor Bower says to watch is the wheat market, especially that spring wheat market that has seen major crop losses in the northern plains, “We have clients in North Dakota and Montana that have lost their entire crop. The wheat market will begin to ration this reduced supply, historically this has been by pushing prices above $10.” He added that the extent of the loss may not be known for a while, but, as the wheat market reacts, it may have an impact on corn and soybean prices, “It is a situation that needs to be watched.”
For more market strategy information, contact Bower Trading at 800-533-8045 or bowertrading.com.
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