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www.thelandonline.com — “Where Farm and Family Meet”
THE LAND — JUNE 25/JULY 2, 2021
MARKETING
Grain Outlook Corn market takes a dive, recovers slightly
Livestock Angles Willing packers keep cash cattle strong
Triple digit moves are an will increase. As this happens The following marketing The Federal Reserve sigand the supply of beef analysis is for the week ending naled this week they will almost daily occurrence in becomes more ready availJune 18. likely raise interest rates the livestock futures as of late. Some is due to the cash able to the consumer, expect twice in 2023 vs. 2024 as CORN — Oh my gosh, where prices moving in large direcprices paid for live cattle to they indicated previously. to begin! It didn’t take long for tions on a daily basis. Some is peak soon after this happens. Interest rates were left the tide to turn in the markets due to the large speculative unchanged for now. They The short-term outlook will and for a variety of reasons. In also raised their 2021 infla- makeup in the market at the remain questionable and just nine trading sessions, tion rate to 3.4 percent vs. present time. Also, it is partly expect a continuation of radiDecember corn retreated from JOE TEALE cal behavior in the futures a recent high on June 10 of PHYLLIS NYSTROM 2.4 percent predicted in due to the overall uncertainty March. Their comments of the underlying economic CHS Hedging Inc. Broker market as well in the live $6.28.25 to a low this week of were considered “hawkish” conditions at the present. St. Paul Great Plains Commodity trade. $5.30.5 per bushel. Afton, Minn. and pushed the U.S. dollar to The current Covid-19 panic The hog market has Weather forecasts are the fresh two-month highs. has disrupted the supply line appeared to find a potential top during easiest and quickest way to account for Adding fuel to the uncertainty about the rapid change in price direction and the markets is the administration’s from top to bottom for the last year and the week ending on June 18. Futures that’s where we’ll begin; but it’s not apparent consideration of revising the is still a factor in the uncertainty of the prices have plummeted under heavy only weather. The fall began when fore- biofuel mandates using waivers or supply chain of the entire meat produc- long liquidation as pork cuts outs have tion. Another cause of wide swings is also begun to fall back from the recent casts indicated better chances of rain- some other alternative. purely the dynamics of the trade. When rally. fall into the last half of June for most of prices move to higher prices than norThe markets imploded on themselves the Corn Belt, but favoring the eastern There is an old saying when hog mal range at any given time, the volaon June 17 with corn locking down the belt. However, drought areas will prices exceed cattle prices it won’t be tility will normally expand. The future 40-cent daily limit — leaving us to go remain unless the forecasted rain is long before the hog market will fall. much heavier than the current outlook. into the weekend with a 60-cent will decide when the volatility will This appears to be what is taking place The weekly drought monitor showed expanded daily trading limit. Funds diminish and the wide swings in prices at the present time. Therefore, the outIowa had a 5 percent increase in some were estimated to have sold 35,000 will also subside. look has the possibility of suggesting As for the cattle market, prices have lower hog prices may be in the future level of drought conditions to where corn contracts during the limit down nearly 82 percent of the state is at least session. The next day’s trade was more moved higher over the past few weeks heading into the fall months. abnormally dry and 50 percent of their subdued as prices retraced over half of as packers continue to buy cattle at Because the export of pork has been higher prices in an attempt to bring corn crop under severe drought. For the June 17 surprising losses. Minnesota, 92 percent of the state is Weekly export sales were within back a better supply of beef to the con- so exceptional over the past year, the experiencing drought, up 4 percent expectations but still the second-lowest sumer. The disruptions because of the initial drop may be the most severe folfrom the previous week. of the marketing year. Old crop sales pandemic have slowed the production lowed by an easing lower as we move into the fall months. China’s Premier Li continues to talk were just 700,000 bushels to bring total of beef products for the past several months. However, as we get back to commitments to 2.73 billion bushels. n about keeping commodity prices at more normal conditions, production “reasonable” levels. This seems to See NYSTROM, pg. 19 I would like to thank The Land for include auctioning or releasing stocks the opportunity to write “Livestock of grains and metals (copper, alumiAngles” for their magazine for all these num, zinc) and restricting speculative years. It has been a pleasure and I will trading. According to news reports, certainly miss writing the livestock corn/change* soybeans/change* China will implement new rules for article in the future. However, after 48 Stewartville $6.55 -.20 $13.54 -1.86 commodity price indexes. Direct stakeyears in the futures industry, I felt it Edgerton $6.33 -.49 $13.52 -2.08 holders in the commodity will not be was time to move on in my life and Jackson $6.48 -.20 $13.55 -1.86 allowed to be part of the price index, retire. Thank you and God bless. v Janesville $6.34 -.35 $13.56 -1.86 effective Aug. 1. A government agency will also determine what commodity Cannon Falls $6.30 -.32 $13.55 -1.87 price news will be made public. The Sleepy Eye $6.23 -.57 $13.64 -1.81 state-owned Assets Supervision and Average: $6.37 $13.56 Administration Commission reportedly ordered state-owned businesses to con Year Ago Average: $2.94 $8.23 trol risks and limit their exposure to Grain prices are effective cash close on June 22. overseas commodities markets.
Cash Grain Markets
*Cash grain price change represents a two-week period.
For marketing news between issues ... visit www.TheLandOnline.com
Information in the above columns is the writer’s opinion. It is no way guaranteed and should not be interpreted as buy/sell advice. Futures trading always involves a certain degree of risk.
