Blog

Recap: "The season of contentment." Most have closed up shop for the rest of the year. There is minimal volume in either the futures or cash. The futures trade is a liquidation of all sides. The outlook is also fuzzy. As the daily traders look for a crack at the mills the long-term traders wonder if that was enough of a buy. In 2023, there have been three good buy rounds, each at a lower cash price and futures bounce. Does the trend continue? I will say this: most of the industry does not want lower cash prices. That tells ...

Recap: The lumber market today has three defined pillars. The first is supply and demand. The other is rates, and then there is inventory management attitudes. All are currently indicating more of the same for 2024. What could be different is inventory management. This past month we saw a much more robust buy round. There was a genuine attitude that buying cash at $370 or $375 held a low risk. We saw that again with the lack of hedging after a $50 run in futures. Most believed that inventory management was sufficient. Distribution and wholesalers want to hold more product ...

Corn has had a rough month as it continues its sideways to lower grind after briefly touching $5.20 in October for the March contract. While there has not been any major market news to direct the market a strong weekly export report this week was welcome to the market that had been bleeding lower. The last few days saw a nice reversal, seeing a 14-cent rally off this week’s lows. Basis has taken a nosedive in many areas of the country hinting that there may be more corn out there than initially expected. With harvest all but wrapped up for ...

Recap: I will continue to focus on the technical side of this market. There are two takeaways from the weekly chart below. The first read is that when a market goes through an extreme volatility event, there tends to be a corrective phase. You can see just how flat the market has become. In 2021 and 2022, the market experienced record prices and volatility. In 2023, the market has been flat. I wonder if the excess volatility has been sufficiently drained yet. The chart shows that futures can run another $50 higher and still be in the flat range. That ...

As we head into end of year, take time to make sure you have minimized your risk and kept yourself open for better prices if they may occur.  It has been a difficult stretch for milk prices which is evident by clients that have had consistent coverage in place are shaping up to get DRP indemnities for their 6th quarter in a row!  Don’t get caught thinking that you know where prices are heading next year.  Here are good ways to protect negative outcomes and still be positioned for better prices in milk, feed and cattle. Milk-  This part is ...