The good news for those that battled the heat this last week is that they will finally see some relief starting tomorrow with cooler temperatures. The bad news is that the damage that was done in the central plains and beyond can’t be undone. Some soybean acres wilted to the point of no return. However, there is still time to get a rain and save a plenty of potential soybean yield, by that same token, without a rain there is still potential production to be lost. There are chances of rain this weekend, but they are of the light shower variety kind.
The acre’s worst affected at the moment are considered fringe acres by the trade but it’s a lot of fringe acres and with little rain in the forecast the affects could creep into some not so fringe acres. Collect enough nickels and dimes and they stack up to dollars with soybean prices known to move in stacks. November soybean futures hit $13.90 at one point this week putting them $1.08 off the low from August 8th. Typically, by the end of August the “unknown” yield opinions round into “known” opinions. Most market participants haven’t seen a hot, dry spell this extreme to end the month of August and those “known” opinions are dealing with a set of unknown historical data to compare too.
October Crude oil futures rallied from $68/brl on June 28th to $84/brl on Aug 10th before backing off that high water mark the last two weeks. This week October Crude hit a low of $77.59/brl before rebounding back to the $80/brl mark. $80 was a key resistance line for technical traders on the way up and those same traders would prefer to see it have another weekly close above the $80 mark after this correction before getting comfortable with the idea that a bullish market may be able to continue. With this week’s consolidation it’s unlikely that either the bears or bulls will be comfortable making any big bets for the time being.
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