WHAT HAVE FUNDS ALREADY FACTORED IN?

WEEKLY GRAIN NEWSLETTER

Audio Version

Some not so fearless comments for www.dailymarketminute.com for our weekly newsletter for March 26th.

 

Funds vs fundamentals vs factored in

As we near next week’s big USDA acre and quarterly we ask our what are the funds thinking for grains, what are our fundamentals telling us, and what is already factored in.

 

Why has China been strong buyers of US corn followed by Xi being in Russia, which then leads to Russia making statements about halting wheat and sunflower exports, followed by ensuring that prices paid to farmers are high enough to cover costs. If you remember correctly just a few months ago we had leaders of Russia and Brazil make comments about needing to increase domestic stocks or carryovers to help their national food security issues.  

 

So the way that I read it is that our biggest competitors for wheat, corn, and soybeans have publicized statements about needing to increase food security, now we have the biggest buyer in the world starting to buy US corn in a strong manner.  

 

Last week’s export sales were the 3rd biggest week in the past 20 plus years. That is a big statement and shows how strong demand has changed in corn in just a few short weeks. If you remember in the March USDA Supply and Demand report we had another decrease in corn exports.  

 

This week’s USDA report will give us an update on the fundamental outlook, but the bigger factor will be what is already factored in. Jon Scheve has a good write up on how important the report is which can be found here: CLICK HERE

 

We will get more estimates as we get closer to Thursday’s report, but so far it appears that the market is pricing in more acres for both corn and beans. I would remind one that this is a producer survey and historically it tends to come in below expectations. There has been huge acre numbers being thrown out by some, but the market probably has priced in some big acres.   

 

Here is a good write up from Pro-Farmer showing some of their thoughts on the acres.  

The real question is what is factored in? Then more importantly than acres will be growing conditions and planting conditions that will either lead to more or less acres of various crops….

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In This Week’s Edition

  • What have the funds already factored in?

  • Will we see a seasonal rally?

  • End of month USDA report

  • Acre war

  • Weather, drought, & yields

  • Seasonal trade

  • Biggest risks in the market


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3/22/23 - Market Update

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3/21/23 - Market Update

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RUSSIA HALTING WHEAT & SUNFLOWER EXPORTS?