Markets are stronger again overnight with corn up 3 and soybeans up 9.
President Trump threw his support behind a $2.2 trillion stimulus package yesterday raising optimism on Wall Street that has supported all markets. Crude oil prices are higher while an increase in fund money flow is supporting the grain markets. Increase in Chinese demand has continued to support the markets over the last few weeks. Funds are now long an estimated 215,000 corn and 244,000 soybean contracts. We are getting to the point where some selloff could be expected with the election only two weeks away. Will traders hold a long position going into an election that could drastically change foreign relations one way or another?
Soybean demand should remain strong throughout the year if China follows thru and takes all of the purchases they have been making. This should continue to hold or pull corn higher to some degree. The biggest concerns could be favorable weather in South America, political agendas and the lack of a cure/vaccine for COVID-19.
Prices are at very good levels for nearby thru next summer and should be captured by all producers. Producers should also be looking to lock in some sales for the fall of 2021 with prices in the $3.75 range. Let us not forget the fear that hit all markets in March of 2020!
Have a Safe Day!