Early June is a little early for a weather premium, AgweekTV's Michelle Rook said on this week's Agweek Market Wrap. But a freeze followed by 100 F temperatures and continued drought conditions have give the corn, soybeans and wheat markets an early boost.
Randy Martinson said the early weather is in part due to tight supply.
"We need to get every bushel this year," he said.
And with the "worst of everything" in the weather in recent weeks, he said that's hard to see happening.
And, as Martinson pointed out, that might mean any adversity in the Corn Belt in July and the market "could be set up for some big fireworks."
Soybeans, he said, took the recent freeze that preceded the scorching temperatures the hardest. Since the final planting date for full insurance in North Dakota is June 10, with 10 more days after that at reduced coverage, farmers are forced into replanting "at the worst time frame" — into dry dirt with no rain in sight.
Martinson expects that Minneapolis wheat could go up another dollar. The spring wheat crop so far is the second worst rated since 1988 and likely to slip into the worst spot. Martinson wouldn't be surprised if some areas end up harvesting only "half of a crop."
Cattle had a tough week after a breach at JBS, or the "JBS debacle" as Rook called it, meant a backup in beef slaughter. Though the company is back up and running, it could take a couple weeks to get back on track, Martinson said. The higher corn prices also continue to hurt the feeder market.
Meanwhile, Martinson said there's no sign of sticker shock for consumers as boxed beef prices continue to climb.
The hog market continues to push higher and higher, as do pork prices. Rook pointed out that supply concerns from disease and high feed costs haven't even begun to play into the ever-increasing prices. Martinson expects that market to continue in its upward trajectory.