The CME and Total Farm Marketing Offices will be closed Friday, July 3, in Observance of Independence Day

It’s All Weather

What’s Happened…

Throughout the year, markets receive information that helps traders and farmers make informed trading and marketing decisions. In row crops, this information comes in the form of direct information such as USDA supply and demand reports, quarterly stocks, or acreage estimates, as well as peripheral information such as the price of crude oil or world political developments and government policy. In recent weeks, row crops have received numerous USDA reports including the June World Agricultural and Supply and Demand Estimates report (WASDE) and recently the Quarterly Grain Stocks and Planted Acreage reports. All this information is now considered old news, as it is known to the market. As traders look ahead, there will be additional monthly reports. Between now and the next 60 days, the most critical variable to price direction will be weather developments and their impact on crop production.

Why this is Important…

This is the most critical time of year – a time when weather can have an exaggerated impact on price movement for farmers. From a marketing perspective, it may be reasonable to assume mostly normal growing conditions, yet that is never guaranteed. The next two months could determine whether crops trend toward high or even record yields, or whether yield potential begins to decline. End users are watching closely, as corn prices have fallen from mid-May highs to new lows at the end of June on expectations for a strong crop. Soybeans have also declined sharply, giving back roughly half of the uptrend established between January and mid-May. As weather goes, so will price direction and, ultimately, the effect on farm income. 

What can you do about it?

Marketing is always something that should be on a producer’s radar. Your marketing strategy may be determined by your position on forward sales of new crop (2026) as well as selling out of old crop. Regardless, a balanced strategic approach should still be front and center. As the past several months have shown, world events and weather can have a major impact on prices, making it critical to be positioned for potential market moves as part of a sound marketing plan. Marketing may be considered the last frontier to separate good farmers from great farmers, and it never takes time off. Great marketing takes time, effort, and energy. Conversations with key people to help you stay on a path of a balanced strategic approach should be intentional and consistent. It is highly likely that the next 60 days will determine if corn, soybean, and wheat prices will reach new highs or new lows. Are you ready for either outcome?

Find out what works for you… 

Work with a professional to find the strategy or strategies that are best suited for your operation. Communication is important. Ask critical questions and garner a full comprehension of consequences and potential rewards before executing. The idea is to make good decisions for the operation and less emotionally–charged responses to market moves, which are always dynamic.   

About the Author: With the wisdom of over 36 years at Total Farm Marketing and following across the Grain Belt, Bryan Doherty is deeply passionate about his clients, their success, and long-term, fruitful relationships. As a senior market advisor and vice president of Brokerage Solutions, Doherty lives and breathes farm marketing. He has an in-depth understanding of the markets and marketing tools, an excellent listener, and communicates with intent and clarity to ensure clients are comfortable with their decisions. 

The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Individuals acting on this information are responsible for their own actions. Commodity trading may not be suitable for all recipients of this report. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Examples of seasonal price moves or extreme market conditions are not meant to imply that such moves or conditions are common occurrences or likely to occur. Futures prices have already factored in the seasonal aspects of supply and demand. No representation is being made that scenario planning, strategy or discipline will guarantee success or profits. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing. Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services, LLC is an insurance agency and an equal opportunity provider. Stewart-Peterson Inc. is a publishing company. A customer may have relationships with all three companies. SP Risk Services LLC and Stewart-Peterson Inc. are wholly owned by Stewart-Peterson Group Inc. unless otherwise noted, services referenced are services of Stewart-Peterson Group Inc. Presented for solicitation.

Author

Bryan Doherty