We all love to grouse about the government, but at least one group of policy makers in Washington were on the right side of the market for farmers last week.
When the Federal Reserve announced a massive intervention in the bond market on Wednesday, the result was a sharp downdraft in the dollar that lifted all boats in the commodity sea. The falling dollar from 2002 to 2008 was one of the causes for the boom in commodities, so this response was quite understandable.
While the Fed's action doesn't guarantee an economic recoverable, it could continue to give the corn market some breathing room as farmers make final acreage allocations ahead of USDA's March 31 planting intentions report. Farm Futures survey, release last week, shows producers plan to trim acreage by 4% this spring, to 82.46 million acres. I've plugged that figure into my forecasting model, and it indicates good potential for a rally to $5 or better given current fundamentals.
Check out the complete Weekly Corn Review.
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