Grain market recaps have been spotlighting that we have had the longest string of 90+ degree days in twenty years. In traveling Nebraska's western corn belt area this past week, the crop shows more resilience than stress. The crop is getting heat, but is also receiving a lot of humidity.
The release of USDA's August 12 crop report may be effected by the Congressional gridlock. With interior terminals corn basis at least 50 over for nearby... what terminals are really paying for quantity and quick shipment needs is anybody's guess. However, as I have heard more than once from farmers, "What difference does it make when you don't have any corn to sell?"
Every time, that I can recall, when the basis has been at "overs" in the interior...there has been very little corn left in the farmer's bin by the end of July. Be prepared for a even larger price inverse spread (old over new) as we get closer to harvest. You don't want to be long "spot" corn basis into this years inverse!
More Hot Air
Considering all the financial hot air in Washington, the equity market has not had heavy liquidation. This, and possibly due to the weaker dollar (for exports), has led to a steady grain price. No matter the economic justification, I saw $35 gold in the 1970s, and it is hard to adjust to the continued flight of gold prices to $1,600.
China Taking the Lead
Last week was the last space shuttle. This week, China
surpasses the U.S. in deep diving in undersea resources. As a nation, I hope the current political theater does not continue to diminish our vision of what is happening in the world around us. Spending two weeks in Chinas does not give me a warm, fuzzy feeling that we are maintaining our global position as a "AAA" nation.
