The Buzz: Weather, Exports Best Hopes for Rally
Friday's USDA report offered few surprises for traders.
Bryce Knorr
Published: Jul 11, 2009
With Friday's USDA reports holding few surprises for traders, the market will focus its sights on weather and export demand, while still looking over its shoulder at outside forces, according to the this week's edition of The Buzz.
Market Analyst Arlan Suderman noted that just a small decline in soybean yields could tight new crop supplies quickly, especially since USDA historically tends to underestimate demand. Also in question is whether Argentina can live up to the government's big export numbers in the face of weather and political problems.
El Nino conditions are also developing that could have an impact on wheat production in the southern hemisphere, Suderman noted, boosting U.S. export hopes.
Senior Editor Bryce Knorr pointed out that futures for corn, soybeans and wheat are all testing important chart support that could lead to further declines if violated, even though prices are very oversold.
On a brighter note, Knorr said farmers should consider taking advantage of big reduction in inputs costs this summer. Fertilizer prices at the farm gate level are finally coming down to levels indicated by Farm Futures fair value models, especially for fall delivery. Propane prices also broke sharply, providing opportunities to lock in fuel for drying what could be a wet corn crop.
To watch the complete program, click here.
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Tagged: farm, usda, wheat, soybeans, farm futures
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