Missed the boat on an active week in corn markets
This was a week away from market news, which made me appreciate my last strategy of getting out of the volatile corn markets and moving into the more stable wheat markets. I ended the first week up more than $2000 from being active in the corn market, but after a second weekend “playing” in the wheat market, my balance had only dropped $37.25.
Had I been keeping up with the markets, I could have followed the drop and subsequent rise toward another equilibrium in the corn market, because according to Bloomberg and Rabobank, the dynamics reflect the USDA predictions of stock and production levels and corresponding supply and demand effects. According to a Bloomberg article from September 27 titled Corn Retreats as USDA Reports Declining Export Sales, “U.S. exporters sold 368 metric tons in the week ended Sept. 20, compared with 69,578 tons a week earlier, the Department of Agriculture said today. Corn prices are down about 15 percent since the worst U.S. drought in half a century spurred a rally to a record $8.49 a bushel on Aug. 10. Wheat export sales at about 426,000 tons were 13 percent below a week earlier.” [1]
Meanwhile, I was short in the wheat market, which, as reported above, dropped from the previous week. Luckily, this market is less volatile, so my damage was minimal.