Watch out of freezing temperatures
Nice rains have been seen through central and northern Iowa. This is helpful for areas that have been dry. Elwynn Taylor, Iowa State University Extension Service climatologist, warned farmers about planting too early. He says that while Iowa temp...
Nice rains have been seen through central and northern Iowa. This is helpful for areas that have been dry.
Elwynn Taylor, Iowa State University Extension Service climatologist, warned farmers about planting too early. He says that while Iowa temperatures are breaking 1936 Dust Bowl records lately, farmers there should expect a freeze. He expects warm temperatures into this week then the weather could change. He notes that here has been only one year out of the past 100 when farmers could have planted on March 15 and everything would have been fine. One chance in a hundred is tough odds. That one year was 1946.
Now, moving on to market news. Export sales were poor for soybeans and wonderful for corn, when adding the old and the new crops together. The September corn is the weakest. Traders are betting that early planting means early harvest.
The September quarterly stocks report will be interesting this year. Will the U.S. Department of Agriculture make the same mistake twice? March 22 is reaction time across the grains: corn, wheat and soybeans. Soybeans were higher on March 21 and should have been (normally) lower on March 22. This did occur.
In fact, soybeans had an outside range day going. Therefore, soybeans could rally and that would be fine. Will they? Corn and wheat closed down on March 21 and they should try for a bounce. However, I think we will see corn fail and fall through the trendline of support that we were trying to hold March 22. I think before the reports are released, we will see old-crop May and July test the January low and September and December take a swing at the lows of December. That may well be a double bottom low. Keep in mind, December corn is trading $2.25 lower than the highs of last year's December corn and is getting ready for a move. December corn's range in February was inside the range of January. Thus far, the range for December in March is inside the range of February. We have a week and one trading day to go. Demand for corn should be good going into next year.
China purchased 350,000 metric tons of feed wheat from Australia that was $50 per metric ton cheaper than U.S. corn. One should also remember that this year is patterning so closely to 1976. That year also experienced a fading La Nina and, by June, an El Nino. Chartists may want to take a look at that year for July corn and December corn. Patterns are pretty close.
Egg sets and chick placements were 94 percent and 95 percent respectively compared with last year at the same time. Broiler prices are at record highs. CIF basis was steady to mixed coming into the morning of March 22. CIF barge has been broken recently but the market remains at or above delivery equivalent. Wheat was weaker March 22, but here again is a market that should bounce. However, that bounce may not go very far. I suspect the one fundamental for wheat to rally would be a forecast for a freeze. That would send that market screaming to the upside.
Martin of Ag & Investment Services Inc. in Webster City, Iowa, can be reached at (800) 527-0051, e-mail email@example.com . This publication is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances as an offer to sell or a solicitation to buy or trade any commodities or securities herein named. Futures and optioning involves substantial risk of loss and may not be suitable for everyone.