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McCormick: Market volatility mixed as traders await fresh news

An ag economist says there’s been some mixed volatility in the grain markets.

Jim McCormick with AgMarket.Net says a lack of fresh news has left grains trading sideways.

“We should be having an October WASDE report and that obviously was canceled because the government is closed. So, we’re not getting your normal flow of news affecting the market, but you’re seeing some interesting moves in the basis spreads in the last couple of days.”

He tells Brownfield the wheat complex has been in a downtrend.

“The demand has been very good for it, but I’m a little bit nervous now that demand is going to start backing away from it. We won’t know that until the government opens up, but also the dollar. The dollar index has had one heck of a rebound from its mid-September lows.”

McCormick says weather hasn’t been much of a factor for wheat producers.

“The biggest thing is as we’re going into the fall season, we have guys getting ready to plant wheat and we need a little bit of moisture. This late fall drought continues to lag, and a lot of producers that have started planted are saying they need more moisture to get this wheat out of the ground.”

He says he’s urging crop farmers to monitor the storage situation.

“When you think about it, we’ve got a roughly 1.5 billion more bushels of corn to handle this fall than last year, so storage could become a premium.”

McCormick says U.S. harvest conditions are mostly favorable and planting weather in South America is generally non-threatening.