Renewed Volatility Brings Opportunity for Grain Farmers

Corn Market Post July Report 071719
Moldy corn ears ( Darrell Smith )

Futures markets remain mixed for the major grains at midweek as traders work to sort out weather, acreage and crop potential in 2019.

During an interview on AgDay with Clinton Griffiths, Dan Hueber of The Hueber Report said there is still uncertainty in what's actually in the field.

"When you get a crop that's three to four weeks behind normal, as well pushing that pollination period back, it just sews uncertainty," says Hueber. "Uncertainty sews volatility and that's exactly what we're witnessing right now is just a lot of volatility in the market."

He says the July Crop Production report from USDA only added to the confusion. 

"I mean, certainly with the planted acres the USDA came up with at the end of June, it retracted some of that with a wider harvested acreage on the July report," says Hueber. "Still carry-out numbers were not what you would call positive but I think this is really showing that the market has a strong question mark on really what's out there."

Hueber says right now the weather will be a market mover day-to-day.

"Does it take us out of the existing ranges that we're in, I would say no," says Hueber. "You've almost settled corn into a trading range in December futures of $4.50 to $4.70 on the upside and $4.20 to maybe an extreme of $4.00 on the downside."

He says that's still above where the corn market stood for months. 

"I think until we find something a little more conclusive, either positive or negative, we will be floating back and forth in that range," says Hueber.  "Over the last 4 to 5 years we've grown accustomed to very stagnant markets and just not a lot of volatility."

Hueber says renewed volatility only brings with it more opportunity. 

"When you've got movement like this, there's opportunity once again," says Hueber. "I think particularly for producers [they need to] put a pencil to it once they get comfortable with what they're growing this year and adjust their marketing strategy."