Market Report: Corn and Beans Lower Again

Market action today was very similar to Monday. By the close, corn was 1-2 cents lower. The big factor today was the Dollar Index rallying about 100 points. There was some pressure from the forecast of more rain for the Southern Corn Belt. One would think that would be friendly to corn because it is delaying planting. It is important to get the corn planted early so it is beyond the critical pollination phase before the really hot summer weather. However, traders viewed the moisture as beneficial and therefore price negative. That goes back to an old phrase, "rain makes grain."

Soybeans had losses similar to Monday, too, closing down 5-7 cents. The higher Dollar Index had an impact on beans, too. Another factor was the assumption by traders that we would see more bean acres in Kansas. Word was a lot of winter wheat acres are being "zeroed out" by insurance adjusters. That means the winter wheat was a total loss and traders think farmers will plant beans this spring. I am not so sure. Under crop insurance rules, you cannot purchase insurance for a second crop. So, that means farmers have to risk all the money to plant a second crop of beans. Will their banker loan them the money? If beans were $12 or $13 dollars it might be worth the risk. But, with new crop beans at $8 to $9 the market seems to be saying don't take the risk!