Grain Update - July 2019

After the stressful and wet spring, the market has priced in some risk premium as the USDA and others figure out exactly what this crop is going to look like. Crop conditions have been worse compared to last year and the 5-year average in both corn and beans. The attached graph shows how funds have completely reversed their position due to weather complications and has also assisted in the recent rally.

The biggest story is that the USDA will be resurveying the acreage estimate for both corn and beans. Corn was limit down the day the original report was released. The update will be done throughout July and will be published August 12^th along with the updated USDA Wasde.

Corn basis has been very strong recently, relaying the message that the market is screaming for corn. The deferred months at our rail locations (Hope and Madelia) are especially attractive numbers as merchandisers are looking for some coverage for next year already.

Remember, our free DP must be priced by AUGUST 22^ND.

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