It has not been a great two weeks for the agricultural commodity market, as selling pressure has dominated the grain complex. Although corn found positive territory on Tuesday, the rest of the grain commodities were in the red again.
“The market had a high expectation of China purchases post-trade deal signing and that has not come true yet,” says Brennan Turner, CEO of Farmlead, a guest on Tuesday’s episode of RealAg Radio on Sirius XM Rural Radio 147. “Even though there is a 30-day implementation period for most of the commodities in focus, logarithmic programs don’t know that.”
November soybeans in particular have dipped eight of the last ten days, closing lower and attempting to find support. (Story continues below)
“It’s been an ugly couple days, but I think ‘peak panic’ has probably passed,” Turner says.
That said, the bottom line is there still some bearish pressure elsewhere, too. The South American market still has a big crop. Will these lower prices spur on some Chinese sales? Possibly, but it’s also a holiday week as they celebrate the New Year, and coronavirus risk has people staying home and will likely have a mounting economic impact.
Listen to the full market breakdown via Brennan Turner and Shaun Haney, here:
Related: Commodity markets need to see boats to China