Stock Futures Get Smashed

On Wednesday, stock index futures were lower in the overnight trade but recovered briefly after jobless claims were higher than expected. “Bad news is good news” has been the mantra for stock investors since higher unemployment has raised expectations that the Federal Reserve will stop increasing interest rates as much. Employers throughout the country have been cutting jobs at an increasing rate. Thursday saw a vicious decline in all three stock indexes, however, as bad news got worse and fears of the insolvency of Silicon Valley Bank (SVB) circulated. The feared meltdown of SVB added fuel to the downside on Friday as the week closed, sending the indexes to new monthly lows.

Wheat Gets Whacked

Wheat futures were sharply lower in all three classes: hard red winter wheat, soft red winter wheat, and spring wheat. Spot (immediate delivery) Chicago futures reached their lowest level since July 21 on the weekly chart. Kansas City wheat reached its lowest level since Feb. 22. Export sales, at 13 million bushels, are down 6 percent from a year ago. Russia continues to offer wheat at prices below all other exporters. Europe is buying more Ukrainian wheat since Ukraine has not been able to compete with Russian for African or Middle East imports. The big wash-out in wheat prices has been attributed to fund liquidation.

NOAA Declares La Niña is Over

After three winters of the La Niña weather pattern, our national Climate Prediction Center says that the long-running climate pattern has finally ended, for now anyway. With the climate now neutral and possibly forming into an El Niño system late in the summer or in the fall, most U.S. farmers, including corn growers, are hoping the forecast will prove accurate. The change in weather comes ahead of the next planting season for U.S. farmers. Some crop-growing states like Oklahoma, Kansas, Nebraska and Texas are still suffering from exceptional drought. Conversely, the El Niño system can create heat waves for India and Pakistan and weaker monsoons, which those countries need to water crops.

Biden Boosts Bucks for Agriculture

In the latest iteration of President Biden’s budget, the administration proposed a $55 billion increase for the Department of Agriculture. Farmland conservation and rules governing crop insurance were two features likely to be debated by legislators and farmer’s organizations in coming weeks.

Winners and Losers

Gold was strong all week and gained roughly $25 by mid-afternoon. April hogs gained two cents per pound, closing at .8745 per pound. Corn, wheat and beans were all down, with wheat down the most. Cotton was down five cents per pound, closing at .7890. Stock indexes were sharply lower. The March Dow was down 400 points by Friday afternoon.