By Jon Scheve, Superior Feed Ingredients, LLC
Wheat’s massive drop was most likely the cause for the decline in corn and beans the past couple of weeks. Large hedge funds often have positions in all three commodities, so if they were selling one, they might be selling all three.
In the last 30 days, wheat, corn, and beans had significant decreases with moderate rebounds last week:
- Wheat decreased $1 per bushel then recovered 20 cents
- Corn decreased 25 cents per bushel then recovered 14 cents
- Beans decreased 45 cents per bushel then recovered 20 cents
This week’s recovery could make technical traders think prices have found a low. If so, they may consider re-ownership or short covering of recent sales in the futures market, which could help prices trend higher.
I’ve noticed a few analysts and advisors who still have 10% to 25% of their 2017 corn unpriced. One advisor was suggesting that farmers price remaining ‘17 unsold corn if July ’19 futures hit $4.
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