May 14, 2021

Corn liquidation continued to finish the week with the past 10 days of trade effectively canceling each other out.  Beans remain well supported and it seems the realization is coming to light that we are actually very tight on soybean stocks and it's likely that bean acres have been lost in favor of increased corn planting this year.  Availability of corn may become dependent by area but basis will adjust to reflect that.  Overnight trade showed strength in the corn, with cash coming back within an arm's reach of $7.00.  This morning also offered supportive news, with the USDA announcing a massive new crop corn sale of 53.4 mln bu to China and the Mississippi River was reopened with no restrictions to traffic but both these headlines went largely ignored.  What we saw the past two weeks was the effect of the new spec position and daily price limit increases that are now in place.  Funds and speculators need markets to move (up or down).  What this week did provide us is a reality check on what needs to be done: sell your crop at profitable levels.  We are still at cash price levels that are, historically speaking, extremely high.  To put new crop in perspective, December corn futures have spent less than 9% of the time at, or above, today's close of 542'6.  November beans have been 1400, or higher, only 2% of the time.

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