Lumber Archives - Page 11 of 13

18 Jan 2022

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: 2022 Rundown So Far

Welcome to the 2022 lumber market. A place no one wants to be, but all keep showing up. Here’s a brief rundown:

The futures market was up over $100 again — The run has been relentless and unforgiving, and it’s hard to find the endpoint. Recently, 4 out of 5 of those in the lumber industry think the market is going higher. Half of those are not long. So why so bullish? The two key factors are transportation and demand. We will look at each side to see if that endpoint can be projected.

Many are looking for the typical first-quarter shipping issues where supplies are bought but can’t ship. That causes an artificial secondary market where the trader is forced to buy anything he can get his hands on from anyone. Here we see a jump in truck orders to “fill in.” This time, trucking availability has been restricted, creating general chaos throughout North America. The fill-in mechanism has broken down, forcing the trader to buy a car for further out shipment regardless of price. This has extended order files at the mills when they typically shrink. It also has pushed prices to the next level.

The bigger surprise coming into 2022 was the amount of demand that continues to create itself. Usually, we could foresee a push coming from the numerous jobs that get bid and rebid. Today most are surprised at the amount of new business that shows up daily. A lot of it is long-term and not close to starting, but it has changed the psyche of the trade and added another level to the already pressured trader. That same trader who can’t buy enough was only yesterday told not to buy a stick. That chase is also pushing prices to the next level.

Let’s Get Technical:

So, what is the next level? On the technical side, the key areas now are the gap left last year at $1,514.80 and an old Fib number of $1,518.30. There is room to get there with a weekly RSI at 75%. Each month is at a new high, and there aren’t any calcs from here up. We know that recently, a market spike has had a corrective pullback. I’m not that confident in a pullback with 3 out of 5 willing to “buy the pullback,” but that has been the trend.

Weekly Round-Up:

The market is back at unsustainable levels. And why do I say that? Because we can only build so many houses, and we do not have the labor to push actual starts to 1.7 or 1.8. At $1,200, there is enough wood flowing to keep a 1.6 pace at least. The market goes to $1,500 or more because there is a significant gap in the chain. Logistic problems have bottled up the flow of needed lumber, and those logistic issues are not going away anytime soon.

Open Interest and Commitment of Traders

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

https://www.cftc.gov/dea/futures/other_lf.htm

About The Leonard Report

The Leonard Lumber Report is a new column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

Before You Go…

The 2021 U.S. grain crop has the potential to be one of the largest on record. Where did all the yield come from, what areas were the hardest hit, and why on God’s green earth are grain prices still so high?

12 Jan 2022

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: January 10

It’s hard to believe that this market has reentered the hyperbole dynamic we saw last year when the market lacked any restraint in upward pricing. The market bottomed on November 2nd at $606 and has gone straight up since. On Friday, the March contract made a new high of $1,250. That is a run of over 100% during the holidays. So, what are the issues causing these spikes? First is the massive contraction of this industry, creating a buy pattern that is out of balance. There are fewer players in the pipeline, making it consistently tight. The other is the new two-week to 30-day pricing that keeps everyone in the market almost daily. A quick summary of today’s dynamic is that when demand is good, there is a constant need to buy, and when demand slows, there is no need to buy under the current model. We started with the latter this time.

The need to buy throughout the 3rd quarter dropped nearly 60%. The new model of only buying when needed and only buying an item that will ship caught the market short. The previous models always had a buying program in place as prices fell, and these guys don’t. If the market slowly turns, there should be enough inventory at the mill side to keep costs balanced. As we saw in November, the slowing of production and shipment issues caused a bottleneck overnight. The market now needs to settle to ease the pressure on prices.

Today, the issue in front of the industry is that they bought great at $700 then added to the pile at $1,000 but are still averaged well. The next time they step up to the trough price will be $1,200, which is off their charts for breakeven.

Let’s Get Technical:

This type of market doesn’t relate well to momentum indicators. That said, March made a new contract high at $1,250 with an RSI of 76.70%. There is a lot of room to the upside. The math keeps bringing the value (volume) areas into focus. The two areas are $1,250 and $1,550. A good indicator on the last run was the Fib extensions. Today the 1.38% move in March is $1497. The technicals are building for a push to that level, and there isn’t much pushback from the trade. It will take a lot of energy to get there, so a pullback in some fashion would be efficient at this point of the cycle.

Weekly Round-Up:

You heard it here first… Because of global economics, if this market goes up to the $1,500 level, it will take out the historic highs, and the momentum build-up will be too great to cool. So, there should be minor issues out there of prices going higher. If you asked us if we would buy it today, we’d say, “I wouldn’t buy it with all of Doug’s money.” You can’t discount the ease of producing this commodity. There is no fundamental cause for this commodity to be over $1,000, and we just have an incredibly inefficient marketplace today.

Open Interest and Commitment of Traders

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

https://www.cftc.gov/dea/futures/deacmesf.htm

About The Leonard Report

Before You Go…

05 Jan 2022

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: 2022 Outlook

What a year. The housing industry plowed through 2021 with record disruptions and record sales. Once a pipeline issue was resolved, another would pop up. We are coming into 2022 with a tight supply and high demand for this commodity. Big dollars continue to flow into the economy, and now a house has reappeared as a valuable asset. There is also roaring inflation which is a double-edged sword for this commodity.

The fact is the housing market is exceptional, and lumber prices are trending higher. The positives are firmly in place, while the negatives will need a dramatic economic shift to come into play. The black swan could be rates or inflation or a greater covid blitz. In any case, it would have to be dramatic. Let us dive into the key factors controlling this industry. Our gut instinct is to rehash the past, and we’ll attempt not to bring up the obvious.

2021 — Year in Review

We came into 2021 at a futures price of $870. While we saw $1,000 the year before, this was much too high for the industry. The refusal to buy put an industry, seeing increasing volume in construction, critically underbought. From there, a panic ensued, and the market went parabolic.

The biggest takeaway from 2021 is that the trade was willing to pay unheard-of prices for wood and passed along the cost. No price level slows buying, and there is no longer too high. What higher prices do is generate a greater supply at a quicker pace. When there is a disruption in the chain, prices go straight up. Today we are either in the middle of that cycle or near the end.

Many would build a plan around the “bookends” of that year’s trade in the past. This is a critical drill for the industry in 2022. The need is to create a value area. We need to look at some of the economics out there to look at the value of this commodity.

Housing starts average in 2021 was 1.586 million. The consensus is projecting a 1.6 number in 2022. That number could be far greater if there were the ability to build. As we said back in 2018, there is only so much capacity to go around. This year, many builders have chosen to scale back building plans so as not to get overextended. Others are adding numbers with lofty goals. Profitability drives their planning, and with the lack of availability still present, profits will stay high.

Where should value sit at 1.6 million starts?

The cost of production is skyrocketing in this industry as in all the rest. The last report showed wages up 9.2%. Yes, that is correct. That means the person who changes the oil in the logger’s truck to the people who do the final cleaning on the home before closing makes about 10% more. And that is if you can find a person to hire.

In the United States, the average monthly job offerings number is around 6 million — The December 1st number was 11 million. The stat that shows the mood of labor is the “quit” rate. This is usually a sub 1% number, and it was a whopping 3% in November. 3% of workings are quitting. These numbers are unsustainable, but many of these costs will not come off.

The best indicator today of the economic issue is the current inflation rate, and in November, it recorded 6.8% with an upward trajectory.

All this is a result of flooding the system with cash. That is flooding a system that was already building strength, and that was not the case in 2009 when the economy was headed lower. We must remember that many funds are circulating in a small economic space today. At this point, it will have to inflate itself out of the problem, which will end the housing run.

We talked earlier this year about how the housing market reacts to a cash-infused accelerating economy. With a better economy, expectations were for the first-time homebuyers to jump into the market after the “lost decade.” We have seen that increase, but more than expected went to the multi-sector. Under these dynamics, an increase in rates will not cause a slowdown in home buying. The norm has been about 38% of first-timers buying new homes, which is now closer to 20%. The troubling statistic is that the 38% group are investors. We do not need to review what happened the last time it was that high.

Projection:

Usually, most outlooks are a counter-trend analysis. Today we see only roses. This industry is highly complicated because of the various amounts of input at all levels. One factor could be bullish at one point and bearish at another. Today, we have numerous positive inputs that will lead to higher prices. At the same time, those factors have a shelf life. The tightness factors are slowing. Last year once those factors were finished, others crept into the equation. The next correction will indicate if that repeats or not. In the meantime, expect the 2021 swings again. It will also look remarkably familiar to the old-time seasonals that would make a top in the first quarter, do the sell in May and go away for the summer, followed by the fall buy starting the cycle all over again.

2022 will show owning lumber products will be a sound investment. Also, owning some type of downside risk management will soften the blow of the wide swings, especially when it is down. It is no longer a “time the buy” market; it is an opportunistic buy market.

About The Leonard Report

Before You Go…

27 Dec 2021

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: A Quiet Holiday-Shortened Week

It was a quiet holiday-shortened week with the roll being the feature. The market broke $100 and rallied back $60 by the end of the session Thursday. All said the weakness in the market was only via futures, and the cash market held steady or gained for the week.

The Christmas holiday keeps giving. Next week there are more holidays to contend with — that’s why we saw the big push before the Christmas week. The question is if the push was sufficient for a while or not. Surprisingly, the cash market demand remained in place last week, so this thing could be off to the races again once the holidays are over. It looks like the aggressive cash buying is to keep the flow going. That will start to ease at some point, but it’s a positive for today.

Let’s Get Technical:

To keep it simple, the market left a gap last week between 990.20 and 979.30. With another quiet week in front of us, we would look for a test of that area. The one caveat is that lumber is famous for leaving a gap partially filled. If that is the case, the 61.70% RSI gives the market a lot of room to go back to the $1,200 area. There are two possibilities next week. Either it back and fills the gap and then trades sideways, or it off to the races dragging cash up with it.

Weekly Round-Up:

The entire market psyche is one of a trade that is range-bound and manageable. This one isn’t ready for that, and it feels like setting itself up for another run-up. Cash is still king but hedging up here is a must.

Open Interest and Commitment of Traders:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

https://www.cftc.gov/dea/futures/other_lf.htm

About The Leonard Report

Before You Go…

20 Dec 2021

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: The Three “C’s” of the Industry

Introducing the Three “C’s” of the Industry:

The best way to recap the market is to look at its tone. To sum it up, we will introduce the 3 “C’s” or confusion, congestion, and consternation. We’ve heard repeatedly, “how could this have happened so fast?” The trade was not looking for an early start to the yearend run. It also believed that there was enough supply. That proved to be incorrect. Most of the supply issues are related to the congestion at transportation points caused by COVID and weather. Things are fluid but at a pace that allows shipping to stay fluid. That is not at a pace to fill in the needs.

This leads us to the third “C,” or consternation. Concern and anxiety about future wood deliveries have trickled back into the marketplace. All have been caught in that nightmare this year and the nightmare that followed. Most are now working towards not being there again in 2022. So, we are ending the year with a more aggressive buy pattern than usual at a time when things are moving slow.

The issue plaguing this industry is its overall weakness in defining value. At $600, 50% of the industry went hand to mouth. At $900, 80% of the industry is hand to mouth. There is no investment in between. The buy-side has to scale into the market as it falls, and that will take the volatility out of the market. Waiting for the bottom is not a business strategy. We think we are seeing more of that today, but after the fact. When everyone owns $1,200, it will be a long way down again. This commodity fits well between $650 and $750.

Let’s Get Technical:

There is a lot of noise between here and 1,000 in January. Trying to gauge the trend during the holidays is fruitless. We’ll say that January futures were up $20 for the week, but the RSI fell 13%. The market is technically very friendly, but trading during the quiet holidays with some big gaps below takes some enthusiasm away from the long side. The Fibonacci points below could be the range to finish out the year:

38% 929.80

50% 1079.00

61.8% 1228.20

Weekly Round-Up:

This push higher had a lot of energy, and in this industry, the earlier the energy, the quicker the end. We think this market needs to cool some for the holidays, but we, including Rick Santelli, Kramer, the Fed, and everyone else, have never been here before. Today the consumer is accepting higher prices as the norm. There isn’t any pushback; builders are paying up, multifamily guys are paying up, homebuyers are paying up. Next year, we have no actual data to track for possible outcomes. Buying futures here could be the best trade of 2022.

Open Interest:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

10 Dec 2021

Agriculture, Corn, Cotton, Lumber Walter Lis 0 comment

AG MARKET UPDATE: DECEMBER 9

This week, corn had a good rally following a couple of big down days last week. The December USDA report was released on Thursday with minimal changes and differences between the numbers and pre-report estimates. World stocks were slightly higher than pre-report estimates at 305.45 million metric tons (304.47 MMT estimate) and marginally higher US stocks. The USDA did not make any adjustments to the South American crop estimates as they remain patient; we should expect next month to see a change. Continue to keep an eye on SA weather as any continued problems could play out in the market heading into the holidays.

CHART1

Via Barchart

Soybeans, like corn, saw a modest bounce following a couple of bad days last week. The expectation of a bearish report proved incorrect as the USDA left the stock numbers unchanged. The exports seem to have been slowing down and remain well short of the Phase 1 deal with China, so we could expect to see the export numbers lowered and ending stocks raised if there is no strong buying into the end of the year. All in all, the report lacked any market-moving fireworks.

CHART2

Via Barchart

Dow Jones

The Dow had a strong week bouncing back from its dip as there were plenty of buyers buying the dip. As fear of the Omicron variant relaxes and positive news on the vaccine fighting this strain, this cycle of the variant worry may have already hit and bounced back in the market. Many analystsare calling for a rally into the end of the year with many firms releasing their top picks for 2022. The CPI numbers will be released at the end of the week and will play out in the market on Friday.

Wheat

Wheat prices have been falling the last week and continued falling after the report. Australia and Canada had larger production than expected. Another important development specific to wheat will be the tensions between Ukraine and Russia, as any escalation would cause problems for wheat exports from Ukraine.

Podcast

For the past year, commodity prices have perpetually soared and continue to trend higher. We’re diving into the fertilizer forecast with a unique guest, Billy Dale Strader, a branch manager for Helena Agri-Enterprises in Russellville, KY., who is truly at the epicenter of the rising fertilizer prices.

Billy Dale planted his agriculture roots on his family-owned farm and has managed regional seed and chemical sales at Helena for the past decade. In this week’s pod, we tackle the big question for farmers and ultimately end-users — is the impact of higher-priced inputs, like seeds, chemicals, and fertilizer, on the supply and demand for the major U.S. crops? Listen or watch to find out!

PRICES-120921

Via Barchart.com

29 Nov 2021

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

THE LEONARD LUMBER REPORT: Futures Were Off $35.70 for the Week

Futures Were Off $35.70 for the Week

The weeks are starting to look the same. Each one has numerous undefined potential threats. Unlike most commodities, this industry has so many working parts that it is hard to rank them from least to most. Let’s look at a few.

The futures market continues to act top heavy every time it breaks through the $800 mark. A combination of speculative profit-taking and basis trades weigh on the run. Most of last week saw a positive market as the BC shipping issues grew. But the COVID talk on Friday changed the focus from worries of undersupplied to concerns of being oversupplied. Unlike most other commodities, housing is affected more by stock market moves, so Friday was tough.

The Facts are in Front of Us

The facts in front of us are that business is excellent, but shipping has slowed. What we are having an issue with is the value of the commodity. If the marketplace stays at 1.6 and shipping remains at a slower pace, then most would agree that the high end of the cash trade is around the $700 mark, and with a typical $100 premium, the futures will be sitting at $800. If supply starts to move freely, cash could rest around $550 and futures closer to $600. This is a fair analysis and would challenge others to set it up differently.

The Sleeper Out There is the Industry’s Psyche

In the futures market, 70% of the industry was bearish back at $500. Today 80 to 90% are bearish at $800. That big negative push keeps the market underbought. Monday, the focus will be on any potential COVID disruptions. Tuesday, we should be back to transportation issues.

Let’s Get Technical:

The futures market is forming a volume area in the mid $ 700’s. If the market starts to rerun upside, that volume area measures up to the 38% retracement point of $924.85. If the market can get to the 38% mark — a good enough base was built, and the futures are on their way to the 61% mark of $1,225. That should be food for thought when developing a basis or general hedging strategy. Using calls would be prudent. On the other side, generally, if a market builds a volume area without a follow-through push, it is a very defined top to focus on. The overall structure of the recent trade in both cash and futures leads me to believe that the chart pattern is trying to build the top end of the trading range.

Weekly Round-Up:

The smartest strategy for those who need a product is to stay in front of it. Owning enough wood or having a derivative positioned for a run-up will keep you out of the middle of the noise. There is no way to navigate the issues thrown at us daily. The only way is to be proactive for those who like all the noise trade the spread. It’s a good buy -20 and a good sell +20. What I do see happening is that those in the middle will have a much harder time staying out of those whips back and forth.

Open Interest and Commitment of Traders

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

https://www.cftc.gov/dea/futures/other_lf.htm

About The Leonard Report

Before You Go…

15 Nov 2021

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: Futures Drifted Lower With Cash

Futures Drifted Lower With Cash

Last week’s feature was a very sloppy cash market, which dragged futures lower on light volume. We are sure of two things going into this week — The first is that the industry wants to buy cash, and the other is that they don’t want to today, which would be a reason for the slow grind lower of futures. It is anticipating a buy. Starting Tuesday, the front month is January, and all the focus for the first quarter will be on it. The trade is looking closely at forward sales, but the fact that mill prices continue to inch lower daily has taken some out of the game. It’s interesting how many in the industry will hold out for the last $25 down, risking $100 up. We expect a better tone after the Thanksgiving holiday.

Supply and Demand

As the industry gears up for the next push, we must look at supply and demand issues again. On the supply side, we saw a decrease in shipments from Canada last month and are expecting the same in November number and again in December — These are transitory numbers. The production and shipments should go back to normal after the new year and new stumpage costs. Now, when exactly that extra supply hits is in question, the effect on the market will be driven by demand.

Reports of a Robust Q1

Reports of a very robust first half of the year are numerous. If that alone were the feature, we would be calling for sharply higher prices. With projects still experiencing a start/slowdown/stop cycle, we’re not sure the added production will offset the increase.

If we are still looking at the $550 area as breakeven, this market is closer to a bottom than a top. Having never been too involved with the dumping/duty issue, it is too hard to make a call. If all the mills go up to $50, it is still cheap.

Let’s Get Technical:

The tail of two timeframes. The daily technical picture has been negative for about three weeks now. They are getting a little overdone if you measure the timeframe, but other than that, they are still showing a negative bias.

The longer-term picture has been positive, just showing a downward wave in a positive cycle. Next Friday will give us a better look at the longer-term outlook.

Weekly Round-Up

This next week has two immediate features, the basis trade, and the duty. Both are potential bear traps. We still believe that the last three months were just a form of price discovery. The market has most likely seen the bottom end but not yet the top.

Open Interest

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/random-length-lumber.html

About The Leonard Report

Before You Go…

01 Nov 2021

Lumber, Market Commentary, Market Updates rcmagserv 0 comment

The Leonard Lumber Report: October 25-31

Weakness In the Lumber Market

If you haven’t noticed lately, there has been a weakness in the lumber futures market. January futures fell $113 with never looking up due to a combination of a flat cash market and end-of-the-month position evening contributed to the selling. The futures market saw outright long liquidation in all months while the cash trade was flat, leading the market to seasonally hit a flat spot in mid-October (this one started later and now has hit the slow period later than usual). The pattern will now be of planning for the first quarter and its needs. Price will be driven by supply as we creep move towards Thanksgiving.

The challenge now is to gauge demand going into the end of the year. There was a sufficient decrease in production for the mills to get control back, but the continued disruptions in the field didn’t create any follow-through. We now need to wait for the demand to pick up at a pace to clear out inventories. My guess is that this will become the norm for the next year or so. Historically the marketplace goes into year-end with the least amount of inventory for the year. This year we also see a slowdown in logging caused by higher log costs. This is not showing up in the supply chain as of now.

The algo selling is relentless. The end of the month selling of long positions created an excellent environment for algo selling. It took full advantage of the sales in the market. I expect to see them show up again this week, but it will go dormant without the other sales. It should be noted that we are seeing the fund type buying in January futures. It’s too early in the fundamental cycle to make much of a difference, but they are around.

Let’s Get Technical

621.00 is the 61% retracement in January of the move. The RSI is 24%, so at 621, the market will be in the oversold zone by then. With the algo, selling points are irrelevant, but there could be a pickup in forward interest with January futures nearing cash. That would slow the algo, and the oversold condition will carry more weight.

Final Takeaways

The trade has gone south. The hand-to-mouth traders are basking in the sunshine. Most have enough supply to keep them out. And finally, you have those who want to end the year with these numbers and not make a mistake. The net end result will be an underbought marketplace at some point. That said, I wouldn’t buy it just yet.

Open Interest

- Section23_Lumber_Options.pdf (cmegroup.com)

Have you heard?

We’re getting out of the field and onto the mic to bring you weekly market updates, commentary from commodity experts, and monthly interviews with the biggest names in agribusiness. Check out the latest episode of The Hedged Edge here:

About Brian Leonard

Brian Leonard is a 30+ year veteran in the commodities trading space. Brian began his career as an assistant in the Soybean pit in the early ’80s and moved on to wood products in 1994. Brian’s current role for RCM Ag Services is to serve as a Risk Analyst specializing in the wood products sector. His customer base spans a large spectrum ranging from wood producers to home builders with different risk management needs.

Do you have questions, or are you looking for more information? Reach out to Brain at [email protected] or 312-761-2636.

09 Jul 2021

Corn, Grain, Lumber, Market Commentary, Market Updates, Research, Soybeans, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: JULY 1-8

The corn market fell thanks to the rain that was received in the Upper Midwest over the 4^th of July weekend. As always when it rains in areas that need it the most, the market freaks out as if it is a crop making/saving rain. The reality is, although the rain was helpful, there are still significant drought conditions across most of the areas that received rain (see in the drought chart at the bottom). With this said, next week is forecasting rain across the western corn belt providing some more relief to those areas before returning to hot and dry after.

CONAB (Brazil’s USDA) updated their yield expectations this morning by cutting their corn crop by 3 million metric tons (120 million bushels). This change came before a freeze event they had recently which could lead to problems and another cut of their expected crop. The USDA will update their estimates of the South American crop next week in the report.

The weekly ethanol report was bullish as production was 2% ahead of pre-Covid 2019 levels. US drivers drove a record amount over the 4^th of July weekend with indications that usage for the summer could be a new record. The USDA is expected to increase their estimates for corn used for ethanol coming up as their numbers are lagging the actual pace.

Via Barchart Soybeans, like corn, fell following the holiday weekend with huge losses on Tuesday to start the week. Weather remains the main focus of the markets as rains in the next week will help but forecasts have it followed by heat and dryness. Bean crop conditions this week were down 1% to 59% g/e. The soybean balance sheet does not have as much room for error as corn so any adverse soybean news will be bullish for the market. The long term up trend broke about 3 weeks ago but prices are still at a great level compared to what we were seeing this time last year. The report on Monday will help tell us what other news should be moving the market other than weather but headlines love to say it rained.

Via Barchart

Dow Jones

The Dow lost on the week after a tough Thursday in the markets. The market bounced back well off its lows on Thursday into the close however to keep some momentum. The markets have been volatile, but the big picture is important as we have traded in the range above 34,000 for most of the last 2 months. The delta variant has had many people worried and keeping an eye on the market for any indicator of how bad it could end up being for continued reopening around the world.

Lumber

Lumber prices have flattened out the last couple weeks after losing over half its value from the peak. Markets are hinting at this being the beginning of a rebalancing as the producers and suppliers feel out the supply and demand story.

Podcast

Check out our recent podcast with Dr. Greg Willoughby: We’re talking with Greg in the new episode about being a “plant doctor”, weather patterns, GMO & organic produce, crop history, technical advances, level 201 education on agronomy, the agronomy equation, Helena Agri, soil biology, American v European agriculture, Greg’s early background in livestock, and the advancement of native plants to modern produce.

https://rcmagservices.com/the-hedged-edge/

US Drought Monitor

The maps below show the current US drought conditions this week vs last week. As you can see the rain that freaked out some in the markets did not exactly fix the drought problems. The rain was helpful but will need more consistent sustained rain to help the crop in the coming months.