Much of the same is expected for the short-term outlook in the grain markets, according to Jack Scoville.( Short-term grain outlook)
The Price Futures Group market analyst said the impacts of coronavirus, a potentially big crop being planted across the Midwest and withering ethanol demand have corn traders concerned.
“It’s not going to get any better, judging from the crude oil trade here (April 27),” Scoville said. “Our feed demand has been imploding because of all the plant closures as well, so all in all, it’s been a tough situation for corn.”
The soybean market has also seen major impacts, however, some of that price pressure has been eased due to demand from China. Despite the increased stability, Scovile said the market is still negative, with the Brazilian currency continuing to drop in value, and Brazil still playing a major role on the global trade market.
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“There’s just not a lot of good news,” he said.
As planting hits full stride across the Midwest, Scoville said any supply-side issues would be helpful to the market. Right now, there haven’t been many issues for producers getting the crop in the ground, and that could continue to weigh on prices.
“We need something to change the overall paradigm,” he said. “Whether it be demand starting to show up or some problems getting the crop in or something like that.”
With states like Illinois continuing their stay-at-home orders through May and other states like Iowa pledging to begin reopening businesses sooner, it will take a dramatic shift to change the market tone, Scoville said.
“I don’t know exactly what it is, but we are going to need to see something pretty soon,” he said. “It’s been a pretty bad situation and I don’t know what will change the market, but something is going to have to trigger (it higher).”
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