9.2.22 Market Recap

This week’s action:  

Corn Dec up 2 @ $6.66

Beans Nov down 18 @ $14.20

KC Wheat Dec down 4 @ $8.78

Feeders Oct up 1.55 @ $184.95

Fats Oct up 1.50 @ $144.55

Oct Hogs down .625 @ $90.025

Oct Crude down 6.50 @ $86.61

 Seasonal Averages:

Dec corn Feb 1 – June 30: $6.80

Dec corn since Russian invasion: $6.70

Nov beans April 1 – today: $14.57

Dec KC wheat since Russian invasion: $10.35

Recap:

**Markets are closed Monday in observance of Labor Day and will open 7pm Monday evening.

Row crop markets are juggling a shrinking crop, global economic fears, and a farmer unmotivated to make additional new crop sales. The market agrees lower production revisions are needed to our balance sheet. StoneX released their latest production estimates yesterday and forecasted American production at 173.2 bpa (ProFarmer was 168.1 last week). IF USDA eventually prints a yield around 170 bpa, it could lead to our second tightest stocks/use on record. This is being reflected in historically strong basis in the western corn belt. 

Expect trade next week to be choppy as early yield reports come in and traders position for the next WASDE on Monday, September 12.

 Forecast:

It remains mostly warm and dry through most of the corn belt. Newly formed tropical storm Danielle has been upgraded to a hurricane but is not expected to be overly threatening to the coast.

For what its worth- the Atlantic went from July 3-Augsust 31 without a named storm. This hasn’t happened since 1941.

Outside Markets:

Reports are out this morning Russia’s Gazprom has halted natural gas flow to Europe via Nord Stream 1, citing a “leakage”. This as news of European business owners are already complaining about their energy bills. Some bills are reported to be an increase of 1000% above normal. Many parts of Europe don’t have home air conditioners so expect the European energy situation to worsen as winter nears and consumption rises. California is asking citizens not to charge their electric vehicles for a few days as they brace for a heat wave. This came the same week they outlawed the sale of gas vehicles by the year 2035. Jackson, Mississippi, is having major issues with their water system; drastic enough many citizens cannot even flush their toilets. Some are expecting the necessary fixes to cost $1 billion. The S&P 500 is down around 7% since mid-August on increased recessionary concerns.

Something that Probably Means Nothing:

In 2020, the $750k+ price category represented about 10% of new home purchases in Denver. Today, that same dollar value represents about 50% of the market. Over 80% of the new homes market in 2022 has traded above $500k. Homes priced between $200k-$400k: 5%.

Enjoy your weekend!