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LEONARD LUMBER REPORT: The futures market had a mixed week

Summary: The futures market had a mixed week as Tuesday saw a good flush of longs followed by a Wednesday of profit-taking. By Friday the market saw a pickup in volume as the roll began. Having an active roll is key to a fluid contract. The market is getting a little fatigued on the sell side. After over 16 sessions without a correction, the attitude has changed to "not short" from "not long." This will leave only the algo and funds left to sell it. They won't compete with themselves for long. Is this a bullish call? Nope, I just ...
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LEONARD LUMBER REPORT: Last week it was about demand. This week it’s all about the structure

Summary: Last week it was about demand. This week it's all about the structure. I mentioned a few years back how the face of this industry was changing. I think it's here. Never have we seen home builders' stock hit new highs in a lumber bear market. And never have we seen a distributor have more sales than many of the producers. Today the product moves very fluidly from the mill to the builder and without disruptions allows for a lower-priced commodity. That is what it looks like out there. Let's look at a few numbers. In the last few ...
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AG MARKET UPDATE: MAY 15 – 26

Corn had its best 2 week stretch in quite a while. As you can see from the chart below this has been the first meaningful rally, we have seen in 2023. As corn planting was 81% complete to start the week, ahead of the average pace, the trade has started to look at the weather outlook as we head into June. A dry pattern has begun forming in the coming weeks as it begins to warm up across the corn belt. While the heat in June is not overly worrisome it will be important to keep an eye on it ...
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LEONARD LUMBER REPORT: IT WAS ANOTHER SLOW WEEK IN BOTH FUTURES AND CASH

Summary: It was another slow week in both futures and cash. As we search for answers, we just may not be asking the right question. The question is if demand is our problem. The data isn't showing it. Reports from the field aren't showing it, but this industry's general malaise today is not typical. All the other sectors of the economy experienced covid interruptions, as did lumber. They have all cleaned up logistics issues allowing for lower prices. So why have most other sectors experienced a pick-up in demand from the lower prices while lumber has not? There is a ...
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Agricultural Risk: The Role of Intermediaries

Agriculture is an inherently risky business. Growers and farmers face a wide range of risks, including weather-related events, changes in commodity prices, and supply chain disruptions. These risks not only affect the farmers but also impact every participant along the supply chain, from processors and distributors to retailers and consumers. This blog will discuss the importance of intermediaries in managing agricultural risk. Types of Intermediaries: Futures Commission Merchants (FCMs): Several types of intermediaries play a crucial role in managing risk. Futures commission merchants (FCMs) are one such intermediary. They provide access to commodity futures markets, where farmers, suppliers, end users, ...
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