Agricultural News
Anderson Says Recent Grain Market Volatility Driven by Better Grasp on World Supplies
Thu, 26 Jul 2012 18:11:42 CDT
A 60-cent drop early in the week on grain markets after weeks of increases gave some traders a little bit of heartburn. Oklahoma State University Grain Marketing Specialist Kim Anderson says the market simply woke up and took stock of the actual supply picture.
"We were expecting prices to back off at some point in time. We had a $2.95 price rally. You go back in time to June 15th, Kansas City Board of Trade September contract, $6.46. On July 20th, the Friday before the Monday on the drop, it was $9.41. It declined 27 cents on Monday, 33 cents on Tuesday, back up on Wednesday, back down on Thursday. You look at cash, it went from $6.07 to $9.03 and back to $8.43."
He said some of the market's fears about the amount of grain for export were allayed by reports out of various producing countries last week.
"If you look at the Black Sea area, they're expected to export 33 percent. Australia was dry, their production is down. Argentina planted less acres. Corn and the drought. Corn production going from about 14.4 billion down to, maybe, less than 12 billion bushels. All of that got us the rally.
"But if you look at what came out this week, it was announced that India is exporting wheat and is tendering wheat for export. Australia got some rain. Their wheat may not be as low as they'd expected. Seedborough is importing corn from Brazil. And the market woke up and says, 'Hey! We are in a world market.' So I think we had some negative factors came in and the market woke up that we may have driven it too far."
Also on this week's SUNUP:
-- Randy Bowman at the Southwest Research and Extension Center in Altus talks about cotton, and so does producer Mark Nichols at his farm in Jackson County.
-- In the Mesonet report, Al Sutherland and Gary McManus discuss drought expansion, burn bans and the number of days exceeding 100 degrees Fahrenheit.
-- In Cow-Calf Corner, Glenn Selk offers advice on limit-feeding cattle as a way to economize hay supplies.
-- In Shop Stop, Randy Taylor and Wayne Kiner demonstrate how to put nutserts into sheet metal.
-- Marley Beem provides tips on pond maintenance in Naturally Speaking.
-- There will also be highlights from the 2012 4-H Roundup opening ceremony, competitions, and workshops.
You can watch SUNUP Saturdays at 7:30 a.m. on OETA. You can watch archived programs on the OSU website by clicking here, or on Youtube by clicking here.
Click on the LISTEN BAR below for more of Kim Anderson's preview of his analysis on this week's SUNUP program.
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