Market analysts are honing in on how the recent weather conditions are affecting the markets.
The western U.S. and parts of the Corn Belt are experiencing the brunt of the drought. As a result, there was little change in the latest WASDE report.
Arlan Suderman, economist with StoneX, says that the short-term outlook shows temperatures will be above normal, drying outcrops.
“We are zapping it fast, and I don’t think the market really recognizes that. NOAA’s Climate Prediction Center has some excellent maps that estimate water in the soils and the deficit covers most of the Midwest right now,” he states. “In the next two weeks are expecting to simply add to that deficit.”
Suderman says that we are in a “negative Pacific decadal oscillation,” which means cool waters off the west coast are giving us a higher risk of drought-type situation.
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