Corn and Beans Sharply Higher Because of the Election?
Corn and beans traded sharply higher today because of the election. At least that is what most traders were saying. By the close corn was 7-8 cents higher, beans gained about 12 cents. The thought process was Hillary Clinton was leading and if she is elected president, there will not be any major changes to bank regulations, Wall Street or hedge fund managers. So I guess it was a "risk on" type of day.
Gordy mentioned today on our 11:15 market report that many times an election can have a longer-term impact on the agricultural markets. However, sometimes there is an unexpected market impact too. For example, if whoever is elected has policies that would result in a higher valued dollar, that would make our exports more expensive on the world market. That in turn could decrease our corn and beans exports and our price.
In the larger picture it seems to me it come down to the basic grain fundamentals and many times elections do not have that much impact. Brazil and Argentina do not have corn and beans to export because of poor weather. China, Japan, Mexico and other countries need corn and beans. We have quality corn and beans available, at a reasonable price and the transportation system available to ship them. Aren't they going to buy them no matter who gets elected or controls Congress?