More ups than downs expected
Dale Durcholz with Agrivisor believes we will start seeing investment money flow into grain markets and agriculture.
“At worst, that means we’re going to have stability on the underneath side of the market. To get any big moves to the upside, it’s going to take a supply thing but demand is still good enough to still give us some rallies,” Durcholz said at last week’s Livingston County Agronomy Day.
Durcholz believes we have settled into an environment where markets are a bit calmer and there is little volatility on a day to day or week to week basis.
“Much like what we had in the middle or late ‘80s and even into the ‘90s, to get any sustained move to the upside, it really takes supply ingredients to carry it.”
South America has become a large influence on our markets. Farmers there are starting to harvest the soybean crop and the second corn crop has not yet been planted in Brazil while it is still dry in Argentina. Expect more volatility tied to South America in the next six weeks. Then, we start looking to our own growing season.
Growers should keep a close eye on wheat as we approach spring since March, April and May are critical months for the crop. Durcholz says if wheat gets too close to the price of corn, it gets funneled into feed. This is more important to the world market than the U.S.
“If we have some things happen with wheat here in the spring, and it’s already dry in the southern plains, we can have some influence on the corn market,” said Durcholz.