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Published February 14, 2008, 12:00 AM

Analysts talk about next year’s markets

It’s the middle of the winter and few people are talking about how weather might affect the markets next summer. Everyone knows that supplies of all grains and oilseeds worldwide are in very tight supply. Those analysts who are trying to figure out what next year’s crop production might be are already factoring in trend line or better yield forecasts.

By: Mike Krueger, The Jamestown Sun

It’s the middle of the winter and few people are talking about how weather might affect the markets next summer. Everyone knows that supplies of all grains and oilseeds worldwide are in very tight supply. Those analysts who are trying to figure out what next year’s crop production might be are already factoring in trend line or better yield forecasts. For some reason no one wants to use average yields. The trouble with using trend-line yields is that it can paint a false picture of big production.

There are a lot of private meteorologists around that charge for their services. I subscribe to a private weather service because I want forecasts that are specially prepared to cover the major crop production regions. Private forecasters are also much more likely to work on long-term outlooks for their customers.

Now that we’re getting within sight of the spring season we’re starting to see more people looking at the potential weather outlook for the growing season. There are, as you would expect, a wide range of ideas on that subject.

The National Weather Service updates its long lead forecasts once a month. Its projections are calling for a normal temperature and normal precipitation outlook for the northern half of the country. That includes this region. They are looking for above normal temps and below normal moisture for the southern half of the country.

A well-known climatologist from Iowa State University has a different opinion. He says the odds for a major drought across the Corn Belt are the best they’ve been in years. The western half of the northern plains has been extremely dry since last summer. This dryness extends into Saskatchewan and Alberta. Weather will quickly start to become more important to these markets.

Krueger is the host of “The Money Farm,” a

syndicated radio and television program

on grain marketing and is a licensed

commodity broker. He can be reached by

e-mail at mike@themoneyfarm.com.

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