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Storage Rate Increases


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Please remember that storage rates could rise to 8 cents/month starting in November for beans and December for corn. Wheat storage is still the least it can be with the variable storage rate yet capable of surpassing corn and beans if the situation and circumstance warrant. But, with the potential for a small crop in the eastern section of the Heartland there might no be a "race for space" this year and it appears that producers are storing the crops on farm.

The NWS is projecting warmer than normal temperatures and normal rainfall in its most recent 6 to 10day forecast and this may be perceived as conducive for corn and bean development. It comes down to weather and politics for the next few weeks and neither are easy to predict.

As we approach first notice day with the September futures and funds generally short the markets we may just float with the spreads for a few weeks. If eastern producers gain more confidence with their corn and bean crops they might rid themselves of their wheat as they are not getting rewarded to store it.



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Steve Bruce comes from the cash grain side of the market working for General Mills at the ChicagoBoard of Trade in the summers in the 1970's calling the country to buy wheat at cheap basis levels and with Illinois Grain learning the barge trade. He then spent the 80's , 90's and 00's servicing commercial clients with Geldermann and Man Financial from the trading floor of the Chicago Board of Trade shared market perception via print and electronic media. Steve takes a fundamental approach to market analysis. He completed his undergrad at Marquette and MBA at De Paul. Steve believes in the free market, Chicago School of monetary policy, and less government involvement and intervention in the grain markets. He is risk adverse but emphasizes spread trades for optimal hedging profitability. Steve can be contacted at 312 985 0156 or 888 391 7894 or email him at sbruce@walshtrading.com.
 
 
Contributing author since 06/14/2018 

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