U.S. harvest pressure lifting
This year’s harvest is starting to wind down in many regions of the United States. As it does, we will get a much clearer indication of actual crop size.
These numbers have been heavily debated for several months, and futures traders have been trying to determine a fair market value for both corn and soybeans. Now is when we will start to see if these levels were correct.
We are also at a time when we see volatility increase in the cash market.
Much of the early harvested crops are now nearing the point where farmers will have to decide if they want to pay storage costs or simply sell the inventory that was delivered to commercial facilities.
This tends to cause volatility in basis values and can set the tone of the cash market for the next several weeks if not months.
One big difference this year is how much storage is needed in regions of what is typically the highest production area of the Corn Belt, mainly Iowa.
Iowa suffered from drought that...