The grain market doldrums aren’t a demand problem, but a production problem — but that production success is cold comfort for farmers looking for a bump in crop prices to reward those extra bushels, says Jody Lawrence, founder of Strategic Trading Advisors.
Farmers are and should be very proud of the great work they’ve done in producing so much corn and beans, but without a Black Swan event or some new demand materializing, Lawrence says that most will just need to keep looking for glimmers of optimism to pull prices up.
That’s not to say there aren’t happenings in the U.S. and globally that could swing the sentiment from sad to glad. There is the possibility of the sustainable aviation fuel feedstock requirements through 45z being finalized, which would be a positive demand driver for U.S. beans, he says. But that’s not a guarantee.
Plus, the South American crops are doing well, adding to the production side of the equation, and then there’s the wild card of RFK Jr’s impact on “Make America Healthy Again” that could change seed oil (i.e. soy and canola) demand, too. All told, Lawrence says, there isn’t all that much optimism to go ’round.
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