Weather holds cards locally, while war still moving markets globally

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It’s been another week of taking in information and headlines from worldwide events that continue to cause volatility in the markets.

That’s according to Randy Martinson, president of Martinson Ag Risk Management. He shared details from the week with Jamie Dickerman of the Red River Farm Network on Friday, April 17, during the Agweek Market Wrap.

Dickerman described the week as one filled with headlines that continue to rock the markets day by day and minute by minute.

“You know, we’re taking information in from a fire hose,” Martinson responded. “You know, and you don’t know what impact it’s going to have or how the trade is going to look at that news that’s coming in, and it’s been making the markets jump pretty good.”

That’s demonstrated through events like wheat making gains due to poor growing conditions across a large part of the southern Plains, something that has been steady for weeks, only to take a hit on Friday because of word that the Strait of Hormuz is opened. Martinson said that the news brought crude down sharply and other markets came down with it.

The headlines are causing repetitive knee-jerk reactions. But Dickerman pointed out that actual delivery is going to be slow to come. It’s likely that energy will be the priority ahead of some much needed agriculture products like fertilizer.

“And even with once the boat gets through the Strait, it’s going to be two months before it hits the next port to be unloaded,” Martinson said. “So, I mean, there is a lot of time from now until the product is going to become available.”

The consistent concerns of weather is what most producers will be watching in the U.S. About 68% of the nation’s winter wheat crop is in some level of drought. Cold weather is another factor that struck the northern Plains on Friday and was expected to bring down temperatures further south as well.

Portions of the Corn Belt are both cooler and wetter than would be helpful for planting to get going. The only crop to be slightly ahead of average planting right now is soybeans.

“So you’re looking at the big picture, we’re looking at continued, delayed planting for the northern Plains and the spring crops, the spring wheat, the barley, and we’re then looking at corn being delayed up here in the northern Plains,” Martinson said.

He fears that the majority of producers might not be getting out until the middle of May to plant their crops.

Cattle market

Cattle traded to new all-time highs this week. A story that came out of Mexico that the borders were reopening to cattle movement was a hit in that market shortly after it broke, even though the story was found to be false.

Martinson said continued cases of New World screwworm mean the reopening of the border remains unlikely.

Dickerman brought up the upcoming Cattle on Feed report, which was expected to be released at 3 p.m. on Friday. Martinson said he expected the report to be neutral to friendly for the market. Continued low supplies of cattle and an expected drop in placements were his reasoning.

(The Agweek Market Wrap is sponsored by Gateway Building Systems.)]]>