On a week where the Dow Jones is off about 5%, oil nearly $4 down, and corn off nearly $6 per ton from its recent high, soybean meal manged to run up $14.
It’s not often we see that kind of rally. Canola meal/pellets trade off the price of soybean meal.
Soybean meal specifically got a boost after it was reported that Argentina’s Ministry of Agriculture might boost tariffs on exports. There has been no official confirmation of that happening. Additionally, hedge funds held a large short position to start the week. It didn’t take much to send prices rallying when funds decided it was time to cover their short.
To make matters worse, run-times on canola unit trains are behind due to delays at the plants as well as blockades on the Canadian rail lane. Protesters are parking their cars on railroad tracks and gumming up the works.
Corn traded $6 per ton cheaper this week from last week’s high as people fear corona-virus and its effects on commerce. Also hitting corn, the International Grain Council estimated that World corn acres for this year’s crop will increase 1% mostly coming from the U.S.
As you can see in the chart below, corn exports are lagging significantly behind last year. If things don’t pick up its hard to see how prices could rally.
Also, word is there is less wet distillers out of Stockton. Call your sales rep for prices on different times periods for DDG.
Thank you,
Paul Quinn
