The USDA planted acreage numbers confirmed what the market had been expecting; a lot of soybeans and a lot of corn got planted, 89 MA of corn and 89.5 MA of soybeans. Likewise, grain stock numbers were about as expected. So now the focus moves to a possible resolution of the trade war and to summer weather conditions. “The market will now go back to what we knew before, weather and exports,” said Bob Utterback, with Utterback Marketing.
While crop conditions look good and there are no adverse weather conditions in the forecast right now, Mike Silver, with Kokomo Grain, says weather worries could produce a rally this summer, “There could be, and most likely will be, factors that come into play from a fundamental standpoint, a weather standpoint, a risk premium standpoint that will allow us to recover some of what we have lost.” He said the corn crop will pollinate in a very narrow time frame this year which makes it very vulnerable to a weather event. He urged producers to prepare for this and to protect themselves from further moves down.
Utterback said, on the Hoosier Ag This Week radio program, that yield estimates in August will also be a market factor, “If we see corn yields above 180 bpa and soybeans yields at 54 bpa, this could pressure the market.” He warned that unpriced grain in storage could be at risk. Utterback recommends, “Roll in the money puts down to take money off the table, but leave some protection in place looking for a bounce.” He added, if producers have to move inventory, do it sooner rather than later.
Purdue economist Dr. Chris Hurt says a watch and wait approach may be the best in these uncertain times.