By: Dan Hueber –
I was slightly disappointed this morning as I arrived at my office to discover not a single May basket, filled with spring flowers and treats hanging from the door handle. Neither on the trip over did I see any children dancing around a Maypole celebrating the return of spring. I believe I will blame it on the weather as of late as the excessive rain and near winter like temperatures have certainly not given anyone the sense that spring is here. At least it would appear that traders have finally noticed that spring is late in coming as well as we have solid strength across the grain and soy complexes, with some commodities such as wheat actually gapping higher. While we shall have to remain patient through mid-week and see if the strength is maintained, this could be a possible harbinger of positive things to come, particularly considering the huge short position that the managed funds groups hold in the ag sector right now. I recognize this barely moves the combination corn, beans and wheat chart off lows but as I have pointed out previously, we are sitting down at what should be solid value, and as the Chinese philosopher Laozi is quoted as having written, “the journey of a thousand miles begins with a single step.”
For the next five days at least, particularly for those east of the Mississippi, the weather forecast does not at all look conducive to making much planting progress. As such, I have to imagine that unless there is something shocking in the reports this afternoon that reflects better than anticipated planting progress last week, the Bears are going to becoming even more unsettled.
It would appear that there is good new coming from Washington DC as late Sunday, Congress appears to have come to an agreement on funding the government through September, a full five days ahead of the extended deadline. While this still needs to be officially passed, I do not believe there are many on either side of the aisle that wants to go through a potential shut-down. Financial related markets all appear to be non-pulsed about the whole thing as we have equities, the dollar, financial instruments and even gold trading basically flat. Maybe with one less distraction and a secretary of Ag now officially in office, possibly Washington can begin to move forward quickly on the 2018 farm bill.
