Curve Ball Friday?
With US markets closed Monday are we in for a turnaround Tuesday a day later than normal on a Wednesday, as the USDA report looms? It looks like we are maybe in for a modest one at the moment with beans, corn and wheat mostly modestly lower in early overnight trade.
The USDA have been no stranger to throwing the odd curve ball in recently, and I somehow suspect that we'll get another one on Friday with production and ending stocks not coming in as low as many are predicting.
The enormous corn longs might just be starting to get a little twitchy and starting to question what has been, up until now, an almost unwavering total conviction that the USDA are wrong on yields and they are right.
As the corn harvest progresses northwards, into the heart of the Midwest there are a few signs emerging that the disappointing yields feared (or is it hoped for?) may not be as bad as in the less productive south.
Some long weekend harvest reports coming out of Iowa are talking of better than expected 225 bu/acre yields for corn. The USDA have stubbornly dug their heels in of crop condition ratings too, at 69% good/excellent they are exactly the same as at the beginning of August despite a lot of hot air over, well, hot air damaging yield potential.
Informa's "it might be good, but it might be really bad" report last week was seized upon by the bulls, at least the really bad bit was, as another excuse to increase their longs.
What they appear to have overlooked at the same time though, was the same firm's increase in harvested area of 1 million acres.
I suspect that for all the USDA's diligence, there will also be a strong desire to reassure the market that there is no world shortage of grain whatever has happened in Russia.
Almost everybody is expecting a reduction in corn yields and production Friday. I always find it disconcerting when the market has an almost blind conviction like this.
Could the USDA leave yields virtually unchanged and increase harvested area, or even go the whole hog and increase both?
The USDA have been no stranger to throwing the odd curve ball in recently, and I somehow suspect that we'll get another one on Friday with production and ending stocks not coming in as low as many are predicting.
The enormous corn longs might just be starting to get a little twitchy and starting to question what has been, up until now, an almost unwavering total conviction that the USDA are wrong on yields and they are right.
As the corn harvest progresses northwards, into the heart of the Midwest there are a few signs emerging that the disappointing yields feared (or is it hoped for?) may not be as bad as in the less productive south.
Some long weekend harvest reports coming out of Iowa are talking of better than expected 225 bu/acre yields for corn. The USDA have stubbornly dug their heels in of crop condition ratings too, at 69% good/excellent they are exactly the same as at the beginning of August despite a lot of hot air over, well, hot air damaging yield potential.
Informa's "it might be good, but it might be really bad" report last week was seized upon by the bulls, at least the really bad bit was, as another excuse to increase their longs.
What they appear to have overlooked at the same time though, was the same firm's increase in harvested area of 1 million acres.
I suspect that for all the USDA's diligence, there will also be a strong desire to reassure the market that there is no world shortage of grain whatever has happened in Russia.
Almost everybody is expecting a reduction in corn yields and production Friday. I always find it disconcerting when the market has an almost blind conviction like this.
Could the USDA leave yields virtually unchanged and increase harvested area, or even go the whole hog and increase both?
