Is There Any Light At The End Of The Tunnel?
Just as markets can't, and don't, carry on going up forever, falling markets also have to bottom out sometime. Of course, a bit like predicting the top of the market, calling the bottom is also extremely difficult if not impossible.
The market WILL turn, that is a fact. But will it be tomorrow, next week, next month or next year?
There could be a bit more bearish news to get out of the way yet.
Early reports suggest that US corn yields are coming in significantly higher than anticipated. Indeed many producers are astounded at how good the corn yield is and wonder, where did this yield come from?
The answer seems to be a lack of heat stress throughout the growing season. The cool August (temps in the 70's/80's) was perfect for corn, and allowed it to reach maturity (although behind normal pace) without the devastating heat that so often causes that crop to be lost.
The subsequent lack of frost in late developing northern areas was the perfect recipe to finish up the season.
Given the large yields (much better than expected) almost across the entire country, its likely corn yields will approach or surpass the record high yield of 160 bu/acre by the time USDA finishes up their numbers in January. Overall, this is bearish corn and with the brunt of the harvest ahead, corn may continue to struggle with the large yields being harvested.
Bean yields haven't been so impressive. That could lead to another cut in soybean yields in future USDA reports.
Overall, the bearish news might be just about all in the corn market (and particularly in the soybean market), with the final bearish news likely to be the much larger than expected corn crop. Once the world knows how big that harvest will be, we may finally bottom the corn market (and all other commodities with it). Mark your calendar for the November crop report as that might very well mark the lows for the corn, soybean, and wheat market.
Beans and corn traditionally bottom out around October, it's harvest time so there's no great surprise there. Whether tradition counts for anything in the present scenario only time will tell.
Historic Corn Chart
Historic Soybean Chart
The market WILL turn, that is a fact. But will it be tomorrow, next week, next month or next year?
There could be a bit more bearish news to get out of the way yet.
Early reports suggest that US corn yields are coming in significantly higher than anticipated. Indeed many producers are astounded at how good the corn yield is and wonder, where did this yield come from?
The answer seems to be a lack of heat stress throughout the growing season. The cool August (temps in the 70's/80's) was perfect for corn, and allowed it to reach maturity (although behind normal pace) without the devastating heat that so often causes that crop to be lost.
The subsequent lack of frost in late developing northern areas was the perfect recipe to finish up the season.
Given the large yields (much better than expected) almost across the entire country, its likely corn yields will approach or surpass the record high yield of 160 bu/acre by the time USDA finishes up their numbers in January. Overall, this is bearish corn and with the brunt of the harvest ahead, corn may continue to struggle with the large yields being harvested.
Bean yields haven't been so impressive. That could lead to another cut in soybean yields in future USDA reports.
Overall, the bearish news might be just about all in the corn market (and particularly in the soybean market), with the final bearish news likely to be the much larger than expected corn crop. Once the world knows how big that harvest will be, we may finally bottom the corn market (and all other commodities with it). Mark your calendar for the November crop report as that might very well mark the lows for the corn, soybean, and wheat market.
Beans and corn traditionally bottom out around October, it's harvest time so there's no great surprise there. Whether tradition counts for anything in the present scenario only time will tell.
Historic Corn Chart
Historic Soybean Chart
