About The Author

Bill Moore

William Moore's market views are centered around his many relationships with Agricultural producers. His weekly newsletter, AGMASTER, provides a blend of fundamental & technical information used to make prudent hedging decisions. Contact Mr. Moore at (312) 264-4337

JULY WHT

For much of last week, the mkt was under the illusion that Russia would open up grain corridors in Ukraine in return for the UN lifting sanctions! The entire concept, in my mind, was a non-starter – total fantasy! But the mkt lent the idea some credence – leading to a sharp break in July Wht! However, over the W/E, Russian escalated their bombing & also demanded no more long range US missiles – which in effect puts a total kibosh on the grain-corridor scenario & justifiably so! Today, July Wht responded accordingly – nearly reaching limit-up! Also, China’s re-opening after Covid-restrictions helped to fuel the sharp rally as the mkt confirmed a seasonal Spring low – after breaking $2.60 since 5/17/22!

 

JULY CORN

Early worries about planting delays caused the mkt to establish a substantial “weather premium” – but now with planting all caught up, the premium is being extracted! As well, there are no serious weather threats so the mkt is consolidating after its $1.00 break from 5/1/22 to 6/1/22!  However, with 3-4 million less acres, the Russian/Ukr war still raging & solid underlying China & ethanol demand, there is no margin for errorin the Northern Hemisphere! So an average to below trend-line yield could easily force July Corn back over $8.00!

 

JULY BEANS

Bullish Divergence is important & the sheer fact that July Beans have only corrected $.50 off their highs while July Corn broke $1.00 & July Wht $2.40 – speaks volumes! It seems to be telling us that maybe not as many beans were planted as originally forecast! And that China still has strong interest in our beans & that changing biodiesel blending mandates are favorable for domestic demand! And finally that 5-6 year low carry-over stocks needs to be replenished – and that if the production out of the Northern Hemisphere mirrors the disappointing crop out of South America, the current prices, albeit historically high – aren’t high enough!!

 

AUG CAT

Cattle is caught between a rock & a hard place – as demand – which should be robust now – as we’re amidst the premier demand period of the year – is faltering – muted by a shaky economy!  The Fed is walking a tightrope – as it jacks up IR’s to combat 40 year high inflation but has to be ever so careful as to not raise them to the point where we tip into a recession! When you’re paying upwards of $6.00 for a gallon of gas – something in the budget has to give – & it very well could be how much the consumer is willing to pay for meat!!

 

JULY HOGS

The hog mkt has just never been the same since China dramatically cut its imports as it totally rebuilt its herd from the devastation of the swine disease!  Then, entering the barbeque season, arguably the best “demand period” of the year, one would have thought the mkt would have begun climbing back to its Spring highs! But alas, a sluggish economy intervened as the Fed was forced to ratchet up IR’s to combat the highest inflation in 40 years! The result has been a mkt languishing in a sideways pattern as the bullish & bearish factors offset each other!!

 

Questions? Ask Bill Moore today at 312-264-4337