The last full week of February was truly "an unprecedent week in the market," AgweekTV's Michelle Rook said on this week's Agweek Market Wrap.
Russia's invasion of Ukraine pushed grains to contract highs, followed by profit-taking sales, leading to mixed performance for most sectors, Randy Martinson of Martinson Ag Risk Management said.
Rook and Martinson walked through some of the questions outstanding for the situation and what it means for the markets. Martinson said much will depend on what Russia's intentions are, but he thinks it'll be a minimum of six months until exports out of the Black Sea region return to normal. Ukraine is a major exporter of wheat and corn, which could mean sales for the U.S.
"Those users have got to go somewhere to get the products," he said.
And it's not just the crops being sold now that are a concern. Martinson pointed out that warfare is not conducive to farmers being out in the fields to put in a new crop.
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"If you've got tanks running across your countryside, you're going to have damage," he said.
When news broke that Russia was invading Ukraine, markets skyrocketed. Rook pointed out that winter wheat and corn were limit up, as were soybeans, though the conflict was not a "soybean news item."
Markets went back down by the end of the week, though, which Rook and Martinson said seemed to be a significant amount of profit taking. Martinson said some traders seemed to be making money and putting it in the stock market.
So what's to come on Monday? Martinson expects profit taking could continue, in part due to the end of the month. And with the prices dropping, Rook asked if U.S. exports could continue to pick up.
"We've got a fire sale going on," Martinson said, noting numerous recent sales. If sales of wheat and corn were to pick up, it would bring some stability to the market, he said.
As for where things go from here?
"Hopefully next week will be a little quieter, but I'm certainly not counting on it," Rook said.
Martinson said more news and concrete evidence of Russia's intentions would help the market settle down, but he expects it to "continue to be a wild ride."
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Cattle and hogs both had down weeks. The USDA Cattle on Feed report was a "yawner," Rook said, with numbers coming in around expectations. The down week in hogs likely was a bit of a market correction, Martinson said, but continued tight supplies should make this just a bump in the road.
