WINNIPEG – This spring’s weather and flooding in the United States has become the main focus for the Chicago Board of Trade (CBOT), said an analyst.
“What kind of planting conditions, how much rain, how much flooding, and how cold things are,” listed Steve Georgy, the president of Allendale Inc. in McHenry, Ill.
The markets have largely finished reacting to the Planting Prospects and Grain Stocks quarterly reports, issued last week by the United States Department of Agriculture (USDA), he said.
With moderate to major flooding in almost 30 U.S. states, farmers who are faced with a curtailed growing season could switch their planting intentions from corn to soybeans, Georgy commented.
He also lamented the pace of U.S. wheat sales, which are behind the USDA’s weekly pace.
“We’re still not selling as much as we should,” Georgy stated, noting such could leave a larger than anticipated carryover.
.@SenSasse and I joined @NENationalGuard to get an aerial view of flooding impact as we traveled to thank volunteers in Fremont, address a community meeting in Niobrara, and receive a briefing in Lynch. More here: https://t.co/78cd5jkTOG#NebraskaFlood | #NebraskaStrong pic.twitter.com/h32kyx0NE4
— Gov. Pete Ricketts (@GovRicketts) March 16, 2019
The amount of wheat acres planted in the U.S. might be affected this year, largely by the heavy snow pack in a number of states, such as North Dakota and South Dakota, he said.
But the planting intentions of Canadian farmers have also become a bit of a factor. Reports have stated Canadian farmers could switch from planting canola to wheat because of the ongoing Canada/China dispute.
As for U.S./China trade talks, which started Wednesday, he said no one is expecting a final deal to be reached this week. Rather, the markets will look for the amount of progress that has been made and how close the situation is to a final deal.
The South American soybean and corn harvest will have a growing impact on CBOT, Georgy said. Especially, with a good-sized corn crop in Argentina, and large soybean crop in Brazil, despite it being smaller than initially forecast.