WASHINGTON, D.C. (RFD News) — Weather continues to dominate the corn market as traders assess whether this year’s crop can still reach trendline yields.
Brady Huck with Empower-Ag Trading says early-season expectations for a near-perfect crop have changed as parts of the northern and western Corn Belt face heat and developing stress.
“It’s an important time of year for developing the US crop size. It’s summer. Some areas are facing above normal temps and need some rain. In June, I believe we were trading a perfect crop out there and that has changed. This crop is starting to get some nicks and dings in it, especially in the northern and western corn belt. It’s not a perfect crop anymore. How bad? You stack ten days of heat, that’s one thing, but you build 20 to 30 days of heat and drought this time of year, and that’s a whole different ball game. A lot of analysts questioning whether or not we can still reach trend yields. If you’re going to have below trend below normal yields in one area, you need above normal yields in another to offset that to still reach trend.”
Meanwhile, some recent rainfall has helped ease concerns in parts of the Corn Belt, but Mark Welch with Texas A&M AgriLife Extension says weather will remain the biggest market driver through pollination and into August.
“We had a weather scare for what might be a heat dome set across much of the corn belt later this month. So the market’s trying to decide, is that going to hold or not? Well, we still don’t know, of course, but we’re getting some pretty good moisture across the corn belt. I think some of that concern may have eased a little bit. Typically it does. Typically we do get the weather we need to make the crop. It doesn’t mean it’s going to be every year. It doesn’t mean it still couldn’t turn in August. The market’s kind of playing out to what it would normally do.”
While weather remains the biggest driver of the grain markets, Chip Nellinger with Blue Reef Agri-Marketing says several global developments are also shaping market sentiment.
“Out of other things bubbling under the surface here. The drought in Europe, the tensions in Iran, the Russia, Ukraine war effectively closing the Black Sea. We’ve had recent attacks on Saudi Arabian ships in the Red sea. Crude oil is up. So it’s a weather market plus, and there’s a lot of things under the surface. Not many of them are bearish at this point. The funds have kind of been in control here on the long side of the equation in the grain markets for the last couple of weeks.”
Traders are expected to continue monitoring weather forecasts alongside global developments as both could influence grain market direction in the weeks ahead.
