The expected pull-back begins — This week in the grain markets

Grain markets pulled back this past week, something that many market participants, including yours truly, were expecting to see. Corn prices fell as harvest 2020 speeds up and the market is starting to consider the impact to ethanol demand, should a second wave of COVID-19 rage across the world this fall/winter. From a headline standpoint, corn’s weekly losses were their largest since April and soybeans haven’t fallen this much in one week since March! Conversely, the U.S. Dollar earned its best one-week gain since April, which put further pressure on the complex as U.S. grain becomes less for international buyers, relative to other options. While canola and soybean prices both dropped considerably this week, the vegetable oils balance sheet remains relatively tight, given the demand for edible oils and feedstocks. Therein, the fundamental for the likes of canola and soybeans look pretty solid over the next few years, but one bullish factor I’m watching more closely is the crush ...