corn crop projection at a record 15.3 billion bushels for the 2023/2024 marketing year, up more than 10% from last year, citing increases in both area and crop yield. The USDA report released on May 12 showed the U.S. Department of Agriculture, which predicted large inventory builds in corn. The grain markets have already been burdened by “ideal planting weather in the Northern Hemisphere, much needed rain in South America,” and last Friday’s monthly World Agricultural Supply and Demand Estimates report from the U.S. Indeed, bearish sentiment was already “currently present in grain markets,” Sal Gilbertie, president and chief investment officer at Teucrium Trading, told MarketWatch. Has lost nearly 6% since mid-April, FactSet data show. He pointed out that commodities, including agricultural commodities, have been on the defensive since mid-April. “A true shock would have been no extension, which would have led to sharply higher prices as traders reacted to the unexpected.” Prices came off on the news, but “only really resumed and confirmed the bearish trend that was already in place,” he told MarketWatch.
“The extension is certainly good news,” said Brett Friedman, managing partner at Winhall Risk Analytics, but the “recent price action in wheat, corn, and soybeans seems to indicate that the market anticipated that an extension was likely.”
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