June acreage report fails to spark lasting rally

By Jon Scheve, Scheve Grain

The biggest report of the year turned out to be a bit of a dud. Normally, this report produces 15 to 20-cent moves in corn and 25 to 30-cent moves in soybeans. Both markets showed signs of a big rally during the first 10 minutes of trading, but those gains quickly faded before the market closed on report day. The following day’s rally was encouraging, but was it simply short covering ahead of the holiday weekend?

Overall, the report was neutral for corn relative to pre-report expectations, but that doesn’t necessarily mean prices have to rally from here. I was disappointed that the USDA left corn acreage unchanged. However, the agency did include this special note with the report:

“The current estimates for corn and soybean planted acreage are based on survey information collected prior to the completion of planting and are subject to normal survey variability.… Continue reading