Weekly Market Wrap-Up
Grain Market Commentary
Friday, July 6, 2018
by David Gleason, Associate Merchandiser
Grains finished the week on a good note. Tariffs did go into place last night, but it looks like a sell the rumor buy the fact scenario. The past couple weeks have been a mess trying to sort out what the political landscape will look like going forward. We saw another complete twist when Scott Pruitt the current EPA chief resigned earlier this week after rampant scandals plagued his tenure. I honestly think it will be better for Ag if he isn’t in the chair as he seemed to lean toward big oil. President Trump told OPEC that oil prices are too high and wanted them to kick up production the market has been up the last couple weeks. The dollar is down today and it looks like traders might finally be acknowledging that tariffs won’t exactly be friendly to the greenback.
Dec corn opened the week at $3.72 ½ and closed the week out at $3.73. This is actually a good close on the week as we reversed the early weakness that the trade experienced earlier in the week. Next week we’ll see another WASDE report which will likely have a fairly muted response as the USDA is not expected to mess with yield until the August report. They will likely make changes to old crop carryouts and take a look at demand for the upcoming crop year. Corn still has a long way to go to get back what the market has lost and it will be an absolute challenge to get up there again as many expect trend line or better this year from a yield standpoint. It will take a weather change or some unforeseen demand to lead us back to highs again.
Nov beans opened the week at $8.81 ½ and closed the week out at $8.94 ½. Beans took all of the losses on the week back on Friday amid a 38 cent rally. Beans recovered only a portion of the $2+ drop from the recent washout. Beans will be volatile going forward as this has not fully played itself out yet. More tariffs are likely on the way unless we see a resolution between the US and China, but neither side looks like they’re going to blink anytime soon.