- Cash market weakness coming out of the north
- Are the cattle to big?
- What is behind the strength in the soybeans
- Will soybean prices continue to grow?
- Why are corn prices going up?
- Wheat continues to see dryness global
- Sum it up its weather & China
- Ethanol report out on Wednesday saw production tick lower
- Not endorsing one candidate over the other how does Nov 4th play into mkts
- Election risks
- Could there be an influx of dairy on the cattle market with current milk prices?
- Wheat up big again
- All the grains up again
- How can we interrupt negative numbers on the deferred contracts?
- All of this related to weather globally
- We are looking at potential serious weather issues
- China, even on holiday, jumped into the markets to make purchases
- Does China panic in weather markets both here & in South America
- Feeder cattle continue to struggle
There was plenty to talk about coming off of the USDA report that sent corn, soybeans, and wheat sharply higher but also threw a wrench in cattle trade. Arlan is keeping an eye on weather in both South America and the Black Sea Region. He also breaks down cash trade in cattle and why hogs are still trying to sort out their latest report almost a week later.
- Should the market have seen the drop in the trade?
- China’s purchases are starting to focus on the new year…does that mean they are working towards South American purchases?
- Dryness in the black sea
- Freeze in Argentina’s wheat belt this past week
- Quarterly Hogs & Pigs
- COF report on Friday
- Soybeans and what the potential is for this crop
- Situation in China includes building hogs & expanding poultry
- South America planting is underway
- One in six restaurants failing nationally…the next 6 months do not look good
Given the recent positive price action of grains and moves by the Federal Reserve the possibility for commodity inflation has started to become a possible reality.
Inflation in it’s nature is quite simple as it’s a general increase in prices and fall in the purchasing value of money. Arlan Suderman, Stone X, explains that often fund managers try to hedge or protect themselves against inflation by purchasing commodities. In mid August the Federal Reserve for the first time in nearly a quarter century unveiled a plan that look to move the US away from monetary policy that kept inflation at around 2%. Given several years of low inflation the Federal Reserve is now ready to let inflation go past 2% for a while before reeling it back in, to offset the years of low inflation. This again is a check mark for the commodity bull that is wanting inflation to help raise prices.
The second important check mark for a commodity bull is available cash to be invested into commodities. That is currently at an all time high and sets at 5.413 trillion dollars. This readily available cash is known as the M1 Money supply.
However Suderman is still cautious to say we could see strong commodity inflation like that of the early 2000s through 2013. That type of strong inflation tends to be more cyclical and Suderman has personally only seen it twice in his life time.
Hear more from Arlan Suderman, on how M1 money supply and commodity inflation go together:
Wet weather moving through the Midwest
4.00 corn a ways out on the futures but what does that mean for corn
lean hog index above $60 first time since May 28th