CBOT weekly outlook: Rain needed across U.S. Midwest

Detail from the front of the CBOT building in Chicago. (Vito Palmisano/iStock/Getty Images)

MarketsFarm — Dry conditions across the U.S. Midwest were among the factors that could affect commodity prices on the Chicago Board of Trade (CBOT) if rain doesn’t come soon, according to Scott Capinegro of Barrington Commodities at Barrington, Ill.

Dry conditions in the region could lead to price increases for corn and soybeans.

“Across northern Illinois we definitely need a good rain. We’re getting very dry,” he said, noting precipitation has often been forecast, only to not materialize.

Capinegro said the dryness could affect soybean crops especially, as they require rain to finish developing prior to harvest.

The derecho wind storm that blew through Iowa last week damaged upward of eight million acres of corn, which is about half of the state’s corn acres, he said. Overall, the derecho affected nearly 38 million acres in the Midwest.

The weakness in the U.S. dollar has provided a bit of a boost to prices. On the U.S. dollar index, the greenback was at 92.510, as it loses ground to other major world currencies.

Another factor that soon could come into play on the CBOT is the findings from the Pro Farmer Crop Tour. “That’s what the market is really looking at,” Capinegro said.

So far corn yields in South Dakota were estimated to be 179.2 bushels per acre, with Ohio corn at 167.7 bu./ac. Nebraska was forecast to be 175.2 and Indiana at 179.8, according to reports.

Soybean pod counts on the tour were 1,250.6 in South Dakota, with Ohio at 1,155.7, Nebraska at 1,297.9 and Indiana at 1,281.1. The tour wraps up Thursday.

On a side note, Capinegro said the nomination of former U.S. Vice-President Joe Biden by the Democratic Party had no effect on the markets.

“It would’ve been if he didn’t get nomination,” he laughed.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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