11/07/2024 Surprise, It was Priced In

On the Grains
I will be honest, a Trump win and higher corn and soybean markets yesterday, were not on my daily radar. I would be lying if I said I wasn’t expecting a breakout, and I surely wasn’t expecting a higher bean market. December corn closing higher five days in a row (depending on today) has its sights set to test the $4.34 from early October. While tariff fears vs China really won’t affect the corn market, our business relationship with Mexico could be in question. EIA numbers out yesterday had the ethanol production at 1.105 million barrels per day, a new marketing year high. Implied grind would put ethanol production at a 5.497 corn usage for the year. It’s pretty early in the year to think that we won’t have a few bad weeks and get wildly bullish just yet. If there is anything in this market that has me friendly, it’s the corn, the spread action on the December/July corn as we have moved from 37 cents into 23 cents. Basis always tries to move corn to the market first, if that doesn’t work, the spreads react and the last resort is the board tries to do it. We are on leg 2 of 3 now.