BUILDING COMMUNITIES ONE BUSHEL AT A TIME

Markets have been on fire here this week with Black Sea shipping essentially stalled. The trouble is, as the board runs up, there are fewer buyers all the time. Price ratio heavily favors corn to the feed mills. The higher prices will buy acres all across the northern hemisphere and eventually the Black Sea will move wheat again as well. That probably results in another, “Markets take the stairs up and the elevator down” sort of deal. Pay attention to the deferred years. I went back to ’22 and looked at ’24 wheat to see how that played out. The market peaked at the beginning of June with $315 wheat. Harvest of 24 would see most wheat trade under $240. History doesn’t always repeat itself, but it usually rhymes. The trend is up right now so selling ’28 wheat above $315 probably makes you wrong in the short term but really right in the long run. Only one of those things matters. Targets, targets, targets.