Volatile week is 'status quo' for crop markets
AgweekTV's Michelle Rook and Randy Martinson of Martinson Ag Risk Management talk about up and down markets, the June WASDE report, reports of possible help for refiners complaining of high RIN prices, an improving cattle market and the future of the hog market on this week's Agweek Market Wrap.
It's been, AgweekTV's Michelle Rook says, "another volatile week" for the markets.
"That's been pretty much status quo," she said.
Weather played a part in this week's up-and-down markets, Rook and Randy Martinson of Martinson Ag Risk Management said on this week's Agweek Market Wrap, sponsored by Gateway Building Systems. Rain in the Dakotas took a little bit of weather premium out of the markets, especially for corn and wheat, Martinson said.
But as Rook pointed out, the question will be how much did the rain really help and was it enough to counter expected hot, dry conditions coming in through the rest of summer. If we're looking at hot and dry conditions again for a week or two, "that certainly will impact the market," Martinson agreed.
Another thing that could impact markets are reports that the Biden administration may be looking for ways to help refiners who have complained of high prices for RINs, or Renewable Identification Numbers, tied to biofuels.
Rook and Martinson also discussed the June World Agricultural Supply and Demand Estimates report. The report cut soybean crush, which hit the soybean oil and soybean markets. It also increased demand for ethanol and exports. Wheat saw increased production numbers in the U.S. and decreased ending stocks due to feed and export demand, but world wheat production is still estimated to be high.
On the livestock side, Martinson has been saying weekly that he's "friendly cattle," and it appears some of his predictions are starting to come to fruition. Live and feeder cattle were up this week, which he called a "long time coming."
USDA estimated one of the best kill weeks in a long time for cattle, which Martinson said should help get the feedlots "cleaned up." But another factor in the higher cattle prices appeared to be even higher hog prices. Cattle, Rook said, don't like to be below hogs, which is where they were this week.
Martinson said the hogs and pigs report due out at the end of the month will help determine where the hog market goes from here . Any decrease in the market likely would come from consumer pushback from higher prices or from a decrease in exports.