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Weather will Continue to Drive Grain Markets

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Weather and markets

July 2014 cornIt didn’t take long after the USDA reports Tuesday for the grain market focus to once again lock in on weather. Since the report the markets have worked higher. HAT meteorologist Ryan Martin says that’s more about temperature than moisture.

“We’ve had good rains over most of the Corn Belt,” he said. “We continue to see decent rains over most of the Corn Belt as we go through most of the next 10 days to 2 weeks, but temperatures are being talked up and I do see some warmer air trying to push in over the western part of the Corn Belt. I think its effects farther east will be mitigated just a little bit, but temperatures are the focal point at this point, not rains.”

Ryan Martin
Ryan Martin

Martin is both a grain marketer and meteorologist. Is there anything at all that could supplant weather as the market focal point?

“Well we are at the time of year where weather is at its most important for the crop. We’re working through corn pollination right now, and in about 4-5 weeks we’re going to be talking about a key developmental stage for soybeans, going into bloom and pod set as we go into the month of August. So I think it’s going to be difficult to draw talk away from weather much, unless we just see the weather talk go away because of lack of weather.”

Martin added, “It’s fine to talk about temperatures being above normal or even the lack of rain, but if we continue to see the crop conditions numbers on a weekly basis stay close to 70-75 percent good to excellent, if we don’t see any drop in the crop conditions, then it’s going to be very hard to argue weather at this point.”

He says short of some sort of wild swing in demand, up or down, there isn’t much that can take the weather focus out of the market from now through the first couple of weeks in August.