RealAg LIVE! with Ted Seifried of Zaner Ag Hedge talking commodity markets

There is no shortage of issues to discuss in the ag commodity complex, and our latest edition of RealAg LIVE! is here to cover the latest in market news, and answer everything you’re wondering regarding the futures.

On this Thursday edition of RealAg LIVE!, host Shaun Haney is joined by Zaner Ag Hedge’s Chief Ag Market Strategist, Ted Seifried.

SUMMARY

• Is there a rally trying to establish itself in corn with the future now above 3.25?
  • South American crop continues to struggle, so that might mean more exports for us
  • there’s been good indications and developments that mean funds could cover their shorts
  • right now we still have to plan and grow this 2020 crop and its just the beginning.
  • not quite yet looking forward to December sales; need another week to 30 days to decide on fall marketings.
  • there’s a lot of room for error this year when marketing based on the wide estimates of fall prices.
• What do you see final corn and bean acres being this year?
  • ultimately we’ll be between 176 – 178 million acres on corn and beans.
  • I am thinking 95 million acres for corn and 83 million for soybeans.
  • we won’t get a record amount of row crop acres in 2020 based on adversity in the Dakotas and others.
• What’s the situation with soybeans?
  • China will likely need to buy beans from us — whether they will fulfill the Phase 1 trade deal is still speculation at this point
  • there’s a lot of risk in the soybean market this year but that bring opportunity.
  • China has the opportunity to look good to the rest of the world if they can live up to their phase one promises.
• Do you think there will be a growing demand for canola?
  • the best thing canola has going for it is that there isn’t a huge over production of soybeans this year
• What happens with crude oil at $34?
  • with commodities, you can either use them, store them, or throw them away — which isn’t the case with crude oil
  • as we start to move through the stockpile, crude oil has a lot of potential for upside.  It would not surprise me to see crude oil above $60 this year.
• What is the outlook for wheat?
  • the obvious answer is that there’s just so much wheat in the world
  • coronavirus is definitely bumping up the demand for wheat and cereal products as people stock their pantries
  • domestic food consumption of wheat has increased, but production continues to fall to record levels.
  • while we don’t need to be making highs in wheat, there is definitely upside potential in wheat
  • I am more bullish beans than wheat at this point.
• With the economy and unemployment where they are, why is the stock market going up?
  • the fear and panic of the shutdown is subsiding and people don’t want to miss out on the next large rally before its too late.
• Meat processors are now starting to come back online — how long will it take to get through the backlog?
  • the market wants to offer packers the best profit margins possible, to encourage more capacity coming online.
  • meat demand is going to be strong, but the question is whether we can get the animals through processing
  • cash doesn’t have much downside potential as long as plants stay open at this point so I see the futures rising to touch cash.
• Any comments on the China/Australia trade tiff for North America?
  • it may open up opportunity for us, but China doesn’t seem afraid to pick fights
  • we need to see the sales to China to feel good about it — if we don’t, then it’s not worth it.
  • China will buy the products they need, when they need them.  They have been playing this game with their trading relationships.

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