The grain market began rallying last summer following the Iowa historical wind storm, mini drought, and flooding rains in China. China’s corn crop was lowered by 2-4% because of one of the wettest summers on record. In addition, the Ukraine corn crop was hurt by a drought, and most recently, soaring Palm oil prices, a weaker dollar, and increasing tight stocks of grains have finally offered farmers a ray of hope. Most recently, a strike in Argentina ports has created a squeeze and foreign buyers are coming to the US for grain purchases.
But what about La Nina? Up until a week or so ago, some minor drought concerns prevailed in far Northern Brazil, but more so in Argentina. Both corn and soybean plantings are being affected by dry weather and maps over-zealous with rains as the situation becomes more serious. There is no room for error as far as reduced global crops heading into 2021.
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