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S.A. crop stress & hot markets
This week's seen an extended rally in the CME Group grains, largely due to continued crop-stressing weather in South America. See what else has been big in ag this week.
The biggest story in ag this week came from South America, where La Nina-driven heat and dryness is really stressing Brazil and Argentina's corn and soybean crops. Despite some rain this week, the conditions are setting up for potential major crop losses, some say.
That stressful weather down South helped push CME Group corn and soybean prices higher this week, with both pits hitting 1-month highs Thursday. Buyers were encouraged by the stressful weather and demand pictures for the grains, helping feed the rally.
So, what will trends like the South American weather situation mean to the grain markets throughout the next year? How's $5.65/bushel corn sound? How about $11.20 soybeans? That was one specialist's guess this week. What do you think?
But, in the near term, there's some "technical confusion" in the grains, one analyst says. "For now, the trend remains down, and until a new direction emerges, perhaps the best thing to do is be patient, and wait for a more definite price direction to emerge from the market," says Ray Grabanski.
Look for the pace and volatility to pick up a bit next week from this week's sluggish pace and light volume, though, add analysts Ron and Sue Mortensen. "Look for wild trade on Tuesday based on weather forecasts," they said this week.
At current levels, grain prices are profitable. Not as much as a year ago, but still solid, according to one recent report. So, do these new numbers add up this way on your farm? Join the conversation!
With income projections like these, the farm land market's another sector that's seen a lot of upward momentum lately. So, with land prices where they are, if you're a renter, does it pay to raise your own rent? It may sound like a crazy idea, but some say it's a good idea. What do you think?
As the year draws to its end, how will you remember 2011? Most responding to our recent poll say they'll remember most the wild weather. Others say the markets, profits overall and land prices are all high on their lists. So, what tops your list?
Hot, dry weather in the South American corn and soybean belt and its effects on the grain markets are big stories this week.