Like Fireworks, Markets Remain Volatile
While many Americans were watching the skies for fireworks last evening, those in agriculture have been watching the markets. For two successive sessions grain markets have skyrocketed higher following a pattern already put in place by the wheat market.
Spring wheat futures traded at the Minneapolis Grain Exchange began a rally in mid-May just below $5.50 per bushel. From there it advanced to $6.75 per bushel last Monday. In the last week, however, that rally picked up the pace by moving almost a dollar and half from $6.75 to Monday’s peak at $8.23. Such a movement has opened the door for greater participation in all grains.
Corn which on Friday had new crop futures trading at $3.80 rose to $4.07 in Monday’s session before settling just below $4.00 a bushel. Soybeans rose from a level approximately $9.20 on Friday to top out on Monday at $9.91. Soybean meal followed in similar fashion with Friday’s low being found at $298 a ton. It shot up to $321 in Monday’s trade.
Volatility stemming from stressful weather forecasts and increased speculative activity is not uncommon this time of the year. Like fireworks, markets can often go straight up with lots of oohs and aahs and in the end a big explosion.