Glacier FarmMedia | MarketsFarm — The ongoing threat of tariffs from United States President Donald Trump as well as current and future weather conditions were some of the factors weighing on contracts at the Chicago Board of Trade during the week ended March 19.
Jack Scoville from the Price Futures Group in Chicago said while most contracts for corn, soybeans and wheat stayed rangebound, the trade war between the U.S. and other nations was an all-around negative influence on prices.
“The potential for that could really do a lot of damage overall,” he said, adding that tariffs and reduced biofuel production would hurt not just other nations, but the U.S. as well.
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“As (Canadians) know very well, the President is determined to get his way on this and it’s going to hurt agriculture as much as anything in the U.S.”
Increased availability of Brazilian soybeans have also cut into the demand for the U.S. crop, said Scoville. While recent export sales for U.S. corn were strong, he believes the anxiety felt by Canada, Mexico and Europe will eventually result in diminished foreign demand.
However, wheat prices were dictated by the weather as of late. Futures were pressured by forecasts indicating heavy rains in the U.S. Great Plains next week. There are also warm and dry temperatures expected in the same region at the end of the month. Meanwhile, dryness in the Black Sea region hasn’t affected wheat prices over there which have either stayed put or declined.
As winter crops come out of dormancy in the excessively wet U.S. South and seeding preparations begin in the Midwest, Scoville said the market is becoming more attuned to the skies.
“We need some warmer conditions (in the Midwest) to get that done. It looks like it will turn colder over the next few days. People keep looking for early planting and it never really happens. This year seems to be no exception,” he said.
Scoville added that while prices appear to be rangebound at the moment, they are closer to the lower end of their ranges than the higher end.
“We could see some rallies in corn and soybeans over the next week or two,” he said.
