Markets are off to a stronger start today with corn up 11, soybeans up 27 and wheat up 16.
Prices are higher off threatening weather and the confirmation of the Fed rate increase of .75. The Central Bank said they will study data and see how the economy looks before additional increases are added to borrowing rate in the future. The Fed is looking for a soft landing and wants to avoid recession. Fighting inflation with interest increases to avoid a recession is an almost impossible scenario for the US Government to work out of. If the Govt can’t cut back spending, it’s all for nothing. Walmart put a major warning out that stores are selling a lot less products and AT&T said customers have quit paying phone bills. Housing sales are down sharply as is new construction. There are some major problems going on here and energy prices have not backed off. The US government has been selling out the strategic reserve at and unprecedented rate with little available.
The 10-day forecast has rain in the south and not much in the Central US. Some rain has been placed up in Minnesota and Wisconsin, which makes sense as the ridge develops, and rain is pushed North. The heat starts to build in Texas and move North and East this weekend. This looks to be a prolonged hot dry period over most of the Central US. Crops will struggle as temps will reach 100 degrees again. These weather patterns continue to change and so far, have not been as severe as forecasted. If this continues, we may see the markets a little higher than current levels, but no significant climbs are expected. We got thru July which is the month that weather is most critical. Rains now will just increase the crop size in the upper Midwest.
Have a safe day!