MarketsFarm — Commodities on the Chicago Board of Trade were mostly lower Wednesday amid a slower news week and harvest activity putting pressure on prices.
“We’ve had a quieter week,” said Steve Georgy of Allendale Inc. at McHenry, Ill.
“The market starts to fall of its own weight as we’re in harvest season.”
Harvest activity, combined with muted export demand, has been the driving force behind subdued commodity values. In particular, export sales for corn were 52 per cent lower last week than they were at this time in 2018.
Over the past week, corn prices have dropped by over five cents (all figures US$). At midday Wednesday, the December contract was $3.86 per bushel.
“When we get into harvest and start increasing our supply, without having demand, prices end up falling,” Georgy said.
Weather forecasts of rain and snow for North and South Dakota, which will likely further delay harvest, weren’t enough to inject a weather premium into the market.
“Right now the emotion is probably lower than it is higher,” said Georgy.
“I wouldn’t be surprised to see this continue until we get some talk of China trade or something to change the emotion.”
China has committed to purchasing up to two million tonnes of U.S. soybeans, though the expectation is that purchases won’t be “all in one big swoop.
“It’s not enough to fix the demand issue we have right now,” Georgy said.
“Until we see tariffs come off, that only helps us get back to where we should be selling right now.”
— Marlo Glass reports for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.