The USDA sent a shock wave across the grain trade on Wednesday at the release of the Quarterly Stocks Report. “Basically, this is USDA’s way of rebalancing the numbers. They brought down domestic stocks to say the crop wasn’t as big as expected,” explained Bob Utterback, president, Utterback Marketing. “This was a fundamental surprise to the market. Traders didn’t expect this level of an adjustment and it will take a few days for the market to recalibrate itself to find out where it will go.” Utterback said the net impact will increase the likelihood of farmers holding inventory. “This will intensify a farmer’s desire to hold onto inventory, preparing for a weather scare in South America. This will put a whole new spin onto the market.”
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