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Home / Futures Blog / Turner’s Take Podcast | Inflation and Ag Market Lows

Turner’s Take Podcast | Inflation and Ag Market Lows

May 20, 2022 by Craig Turner

Turner's Take Podcast

Play Turner’s Take Ag Marketing Podcast Episode 311

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In this week’s episode we ask the question how will inflation change trading ranges in the ag markets once we go back to adequate and burdensome stocks.  Will we see $3.00 corn again or $4.00 wheat?  How about $8 soybeans or $400 canola?  We take a look at what inflation did to commodity prices in the 1970s and how they never did go back to the old ranges from the 1960s.  Make sure you take a listen to the latest Turner’s Take Podcast!

Inflation & Ag Market Lows

Below is a 60 year chart of corn.  In the 1960s corn traded between $1 and $2 a bushel.  The period of rapid inflation started in 1972 and did not end until the early 1980s.  While many factors were blamed, inflation usually is a product of easy money for a prolonged period of time combined with massive spending deficits.

From 1972 to 2007 corn generally traded between $2 and $4 a bushel.  In 2007 the market changed due to a combination of the Renewable Fuels Standard (RFS) program plus the emergence of China as a major buyer of all commodities.  A new trading range was formed and corn would traded between $3 and $4.50 when stocks were adequate to burdensome. When stocks were tight, corn could trade between $4.50 and $8.00

We are now in a new period of inflation.  The latest CPI reading for the US has inflation up 8.3% since last April.  Canada’s latest inflation reading came in at 6.8%.  No one thinks inflation will stop anytime soon and Central Banks have a long way to go with raising interest rates.  The question we have been asking is, when inflation is finally brought under control, what will be the new trading range for the Ag markets?

For now we can only guess.  We will not know for sure until the we have a period of adequate to burdensome stocks of corn, soybeans and wheat.  I don’t see that happening for at least a full crop cycle.  Soybeans have a chance for adequate stocks is S. America have a big crop next season.  For corn and wheat it could be longer depending on what happens with Ukraine.  This will be a topic we will continue to revisit as inflation rages on. Stay tuned!

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 Twitter: @Turners_Take Contact Craig Turner

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The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI does business as Daniels Trading/Top Third/Futures Online. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

© 2023 StoneX Group Inc. All Rights Reserved

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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Risk Disclosure

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI does business as Daniels Trading/Top Third/Futures Online. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

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