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“Russia’s wheat freeze, historical corn price patterns & how global weather extremes are affecting markets”
by Jim Roemer - Meteorologist - Commodity Trading Advisor - Principal, Best Weather Inc. & Climate Predict - Publisher, Weather Wealth Newsletter
Weekend Report - MAY 10-12, 2024
From historic flooding that has jeopardized southern Brazil’s soybean crop to a major freeze in parts of western Russia and northern Ukraine’s wheat area, the world’s weather has become more and more extreme. Do you think this is just the effect of a diving El Nino???
. . . Wrong !!!
The global heat content of the oceans has broken records set back hundreds of years (never observed before).
Now, with the USDA report out of the way, I will be monitoring the following, for WeatherWealth clients:
1) My Midwest drought easing forecast from a month ago:
a) Will this result in planting delays deeper into spring?
b) Could summer turn hot and dry?
2) Just how bad is the freeze situation for Russian wheat vs improving weather coming for Plains wheat with good rains?
3) Will the flooding in southern Brazil be enough to cause a bull market in old crop soybeans?
4) Does coffee, cotton or cocoa have upside potential this summer or autumn, due to a transition towards La Niña?
Currently, the atmosphere is still experiencing occasional weak El Niño conditions. This could bode well for the Midwest grain harvest this summer and benefit global cocoa crops following major weather and disease issues that launched cocoa into a parabolic trajectory that took futures to historic high levels.
One of the things we study at BestWeather is the correlation of commodity prices and cycles with weather and yields.
For example, take a look at the history of December corn prices since 2000.
Without going into too much detail, the red and green bars represent the months when December corn made its first and second highs. In other words, one can see that corn's price often rallies during June, making its high, and then falls 70-80% of the time in July and August due to good Midwest pollination weather. Of course, there are exceptions, such as the summer droughts of 2011 and 2012.
Please join farmers, commodity investors, and hedgers around the world who want better weather information, and learn how one can relate it to the markets and trading. There is no obligation, you can cancel at any time.
You will also see some of my past reports and how clients may have made over $10,000 a contract by us catching the top of the cocoa market a few weeks ago and a bearish longer-term attitude last summer in corn and soybeans. Is this changing?
Please feel free to request a complimentary trial subscription here: https://www.bestweatherinc.com/membership-sign-up/
Here are the headlines of one of three reports this past week:
Snows in Salt Lake City this winter… (First time, ever, that a soccer game was played in the snow)
The record-warm winter helped natural gas prices to collapse 50% this past winter (once again)
Historic western winter snows often bode well for Midwest corn and soybean crops for July and August.
Frost in Ukraine helped the wheat market rally earlier this week
Soybean market watchers will be keeping their eyes on more floods in southern Brazil vs Midwest planting and summer weather.
Thanks for your interest in commodity weather!
Jim Roemer, Scott Mathews, and The Weather Wealth Team
Mr. Roemer owns Best Weather Inc., offering weather-related blogs for commodity traders and farmers. He also is a co-founder of Climate Predict, a detailed long-range global weather forecast tool. As one of the first meteorologists to become an NFA registered Commodity Trading Advisor, he has worked with major hedge funds, Midwest farmers, and individual traders for over 35 years. With a special emphasis on interpreting market psychology, coupled with his short and long-term trend forecasting in grains, softs, and the energy markets, he established a unique standing among advisors in the commodity risk management industry.
Trading futures and options involves a significant risk of loss and is not suitable for everyone. Past performance is not necessarily indicative of future results.
On the date of publication, Jim Roemer did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
