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Market Commentary for 5/1/23

Jon Scheve with weekly market commentary made on April, 28, 2023

Which Direction Will December Corn Prices Go?

This is the million-dollar question everyone wants to know. Unfortunately, no one knows the answer because the biggest driver will be July weather and rainfall. Since no one can predict the weather accurately beyond 1-2 weeks, it is impossible to predict future prices for this fall.

For example, the following chart compares the current December corn market with the December contracts from 2012 and 2013. So far through April, prices have been pretty comparable for all three years.

For 2012 and 2013 this price consistency continued through mid-June. However, in late June there are dramatic differences. In 2012, dry weather forecasts started and continued into July throughout most of the growing areas. Conversely, in 2013 timely rainfalls in July led to mostly trendline yields throughout the corn belt. Moving forward prices for 2023 could follow either 2012 or 2013 depending on several unknown factors: For a repeat of 2013:

  • The majority of crops need to be planted on time.

  • Total planted acres need to be near the March USDA predictions.

  • Timely July rains will be needed to produce near trendline yields.

For a repeat of 2012:

  • A major planting delay or reduced total planted acres.

  • Widespread dry weather in July

But, with the unknowable global factors like the Ukraine war or political issues around the world it is impossible to predict with certainty price direction 6-12 months from now. Bottom Line: If someone could predict the weather, they could better predict prices. Since that is unlikely to happen any time soon, there will continue to be uncertainty and price volatility in the market.


Jon Scheve Superior Feed Ingredients, LLC

9358 Oak Ave Waconia, MN 55387 jon@superiorfeed.com

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