For those of you following the grain market, how do you distinguish seasonal lows and dips versus the bigger issues that are driving prices down?
Chuck Penner, founder of Leftfield Commodity Research, says it’s not an easy distinction to make.
This time of year, as the calendar turns to summer and harvests are measured on a weekly basis, some markets are seeing a natural downward trend, such as the oilseed complex of canola and soybeans, and we also currently have examples of markets, such as flax, that should be going down but aren’t.
“Right now there’s no market issue to trade in other markets,” Penner said, as much of the world’s growing regions are finishing up their harvests. Watching for news of bad weather or production difficulties will be key.
Regarding canola and soybean prices, the U.S. Distribution of counterfeit used cooking oil A saturated biofuel market could boost demand for canola seed moving to the U.S. and encourage domestic oil extraction, which would be a positive for the oilseed industry, he said.
Penner said unless you’re selling old crops, now is the time to be patient, even though crop potential improves as the growing season progresses. Waiting out the summer slowdown may be the wisest move in this cash market.
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