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Home / Futures Blog / Turner’s Take Podcast | August WASDE Bullish Corn & Wheat

Turner’s Take Podcast | August WASDE Bullish Corn & Wheat

August 13, 2021 by Craig Turner

Turner's Take Podcast

Play Turner’s Take Ag Marketing Podcast Episode 283

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The USDA’s August WASDE was bullish for corn and wheat while slightly bearish for soybeans.  In our podcast we go over why the markets will trade in range for the next month or two but could really take off later this year.  Also take our first look into the 2022-23 marketing  year for corn and soybeans to see what the ending stocks (and price) might look like a year from now. Make sure you check out this week’s Turner’s Take Podcast!

If you are not a subscriber to Turner’s Take Newsletter then text the message TURNER to number 33-777 to try it out for free!  You may also click here to register for Turner’s Take.

August WASDE Analysis

They say it takes two days for a major USDA report to trade.  Day one the market trades the headlines.  Day two the market trades the guts of the 40 page report. I went through the WASDE again last night and today and these are my main takeaways

  • The major US grain markets will remain tight for at least six month and possibly the entire 2021-22 marketing year
  • The high price of wheat, corn and soybeans will make it difficult for any one major crop to “buy acres” from the other
  • Corn and soybeans are likely to be choppy and trade in range until export demand picks up during harvest. This is the time of year weather premium comes out of the market as the USDA confirms the size of the crop. Deliveries against Sept futures along with harvest pressure have bearish influences in the market.  On the flip side the market knows we have tight stocks, end users will use breaks to add to coverage, and we expect a lot of demand interest during harvest.  For the next month or two we like being short straddles. 
  • South America has to have a good crop.  The US and the world can not afford another short crop from a major exporting region.  It would not just be an issue of high prices.  Another bad crop means shortages of grain and oilseed.  The last time this happened in 2012 animals were culled due to lack of feed and lead to a two year livestock bull market.
  • Meal could be the most plentiful feed substitute for corn and wheat shortages.  The high price of vegetable oil may mean crushing for oil and meal gaining feed share vs corn and wheat.  The IUS could be a much larger exporter of meal next year while keeping the soybean oil home for biodiesel processing.
  • October through Dec could be big months for grain price rallies if demand is strong during harvest and an early La Nina impacts S. American growing weather.

I think we are going to have tight stocks and high prices for at least six month and possible for a full year.  That lead us to take a look at the 2022-23 marketing year.  We assumed 180mm acres of corn and soybeans combine, about the same as this year, with 88 to soy and 92 to corn.  With trendline yields and similar demand estimates year-over-year, corn and soybean stocks get back to adequate levels.  Odds are the US is at least a year away from $4 corn, $6 wheat, and $10 soybeans, and that is with a good S. American crop and trend line yields for 2022-23.

Interested in working with Craig Turner for hedging and marketing?  If so then click here to open an account.  If you are a speculative or online trader then please click here.

Turner’s Take Ag Marketing Corn Supply & Demand Scenarios

Turner’s Take Ag Marketing Soybean Supply & Demand Scenarios

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes! Craig Turner – Commodity Futures Broker 312-706-7610 cturner@danielstrading.com Turner’s Take Ag Marketing: https://www.turnerstakeag.com Turner’s Take Spec: https://www.turnerstake.com Twitter: @Turners_Take Contact Craig Turner

Filed Under: Turner's Take, Turner's Take Podcast

About Craig Turner

Craig Turner is a Senior Broker at Daniels Trading, author of Turner’s Take newsletter, and a Contributing Editor for Grain Analyst. Craig is often quoted in the Wall Street Journal, Reuters, Dow Jones Newswire, Corn & Soybean Digest, and also makes appearances on SiriusXM – Rural Radio Channel 80 providing commentary for the Grain and Livestock markets. Craig has also been featured in FutureSource’s Fast Break series, Futures Magazine Online, and INO.com. Mr. Turner has a Bachelors from the Rensselaer Polytechnic Institute (RPI) where he graduated with honors and has worked at the NYSE and Goldman Sachs. While at Goldman, Craig earned his MBA in the NYU Stern executive program. Learn more about Craig Turner.

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