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Yet another crop report?

Agriculture.com Staff 02/13/2016 @ 11:16am

The USDA November crop report, due out on Monday, can be viewed two ways.

First, some may consider it not a big deal, because of the shock of the October 28th special report. How many shocks can occur in a short amount of time? Any changes in production may be small compared to the adjustment made in the special report.

On the other hand, there are still a wide range of yield estimates out there. Many are expecting a lower bean yield and a higher corn yield. And there are well respected analysts with the opposite view. All this points to the possibility of a surprise in the report.

The demand issues will be larger and more important as the crop year progresses. Slow global demand has particularly hurt corn exports. On the other hand, bean exports have been large, with the primary destination being China. The Chinese economy has been hurt by the global economy, but only slightly. The underlying fundamentals of increased consumer spending and desire for more meat in that country are still very much intact.

Given the late harvest, there really could be surprises in this report. Will any of the numbers have any effect on the futures market? If the stock market, dollar and crude oil are calm on Monday, grain market fundamentals can show throughËœpositive or negative. If there is financial market turmoil, all bets are off.

The risk of loss in trading commodities can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial situation.

The USDA November crop report, due out on Monday, can be viewed two ways.

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