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Those out pushing the back-breaking snow throughout the upper Midwest are falling farther behind in the race to plant crops.
The
downturn in weather
is being felt throughout a large swath of the country, explained Randy Martinson of Martinson Ag Risk Management, during the Agweek Market Wrap on Friday, April 21, with Randy Koenen of the Red River Farm Network. Koenen noted snowfall amounts from 4-6 inches in the Grand Forks, North Dakota region.
Poor weather can sometimes be a boost to the markets, but instead they took a dive towards the end of the week, Martinson explained.
Looking ahead, a few days of dry weather looks to be followed by more moisture.
“That tells us that we’re not going to see any planting taking place in a timely basis up here in the northern Plains. It’s likely that we’re going to lose some wheat acres and we’re going to lose some corn acres. We’re going to see some prevent plant – maybe not to the degree that we saw last year but we’re still going to have to deal with it.”
He feels that may bring some stability to the markets, but frustrations for farmers looking at snow-covered fields. The cold weather is stretching far down into the southern Plains, and Nebraska has some concerns of seeing their soybeans freezing. While moisture is coming for large parts of the country, those that need it most in Kansas are not seeing enough.
Koenen described it as a risk-off week in the markets. That refers to a drop in the stock market because investors want to avoid risk.
“We started this week on a decent note but then it seems like the wheels came off,” Martinson said.
Koenen wondered if the options expiration coming off was a reason for this. Options expiration occurs on the third Friday of the contract month.
Martinson said it’s likely it did.
“I think there was a bit of hunting going on,” he said.
Spread trading during the week was supportive to the Chicago wheat market as well as May and July corn and soybean contracts.
The USDA’s Cattle on Feed report came out on Friday and was a bit bearish, or negative.
“Overall a little bit negative report,” Martinson said.
The report indicated a 4% drop in cattle on feed from a year ago. Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.6 million head on April 1, 2023. The inventory included 7.12 million steers and steer calves, down 6% from the previous year. This group accounted for 61% of the total inventory. Heifers and heifer calves accounted for 4.50 million head, down 2% from 2022.
Martinson expressed that the higher price of beef is being felt by consumers. The cost spread between beef and pork and poultry is growing and there is no shortage of either the pork or chicken supplies.
“We might be a little overpriced compared to our competitors,” Martinson said of the beef market.
Looking ahead, Martinson looks to see planting no sooner than the second week of May.
“If that’s the case, you know what, I think the wheat market or the corn market has to see more maneuvering,” Martinson said.
As Koenen pointed out, planting was late last year, too, but it worked out.
“The crop was so late last year — but we ended up with a whale of a crop,” Koenen said.
“We can do it again,” Martinson added.
(The Agweek Market Wrap is sponsored by Gateway Building Systems.)
Michael Johnson is the news editor for Agweek. He lives in rural Deer Creek, Minn., where he is starting to homestead with his two children and wife.
You can reach Michael at mjohnson@agweek.com or 218-640-2312.
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