Monday March 15, 2021
US$ 91.68 down .33 for the week
Continues to go no where
Corn futures lost 1 cent last week after USDA said there was no change in the supply number and the trade was looking for at least a small decline. There was also a continuation of no export sales reported. Now what? I would say because supplies are neither burdensome or tight until we get closer to the actual planting date for corn we need some sort of outside news to move this market one way or the other. The estimates are out for acreage and no surprise that they are higher. The feeling is that due to drier conditions that there will be more acres available. Keep in mind that those are not going to be the high producing acres. I read somewhere that unless we plant that 94 million acres and yields remain good the supplies don’t change. I do not think it is that simple because there are just too many factors. Get that Heartland 3 Point Hedge in place.
March soybean futures lost 9 cents last week due to USDA leaving the supply number unchanged. The trade wanted to see it lower so there was nothing to fuel the market higher. Keep in mind by leaving all numbers unchanged the stocks to use ratio also stayed at 2.6% which is a multi-year low. That keeps this market more explosive and I do mean either direction. The reason I say that is perhaps that is this year’s low and increasing stocks will be negative. We know there will be soybeans in SA but the positive side would be our growing season. That is a ways off.
The April futures contract gained 17 cents last week. Whoo-hoo. And guess what? The cash trade remained unchanged again at 114 and 180 dressed. In some ways that is a positive in that it sure could have been lower. I think that we would all agree if the cash trade would drop even 50 cents that the April futures would crash and burn. April futures have not traded above Friday’s high and do need to bust through 120 or else. June futures are trading above April at 121 and that is extremely unusual. The June 120 put options are less that 3.50. Hmmm?
Any statements of fact herein contained are derived from sources believed to be reliable, but do not purport to be complete. No responsibility is assumed with respect to any such statement, nor with respect to any expression of opinion herein contained. Futures trading is speculative and a substantial risk of loss exists. The prices above may reflect those of the relevant spot contract. Movement in the spot contract does not necessarily correlate to the movement of individual option premiums. Past performances not necessarily indicative of future results