Corn: It’s Popping!

| April 2, 2014 | 0 Comments

GrainsNo doubt about it, Monday was a very big day for the grains market.  In case you’re unaware, that was when the USDA released their highly anticipated quarterly stocks and prospective plantings report.

And what investors found in that report was quite shocking…  

But before I go into detail about the USDA’s findings, let’s take a step back.  As you may remember, grains were highly shorted commodities not long ago.  In fact, corn sank to nearly $4 a bushel earlier in the year, while soybeans dropped to $12.50.

At the time, investors were convinced there would be ample supply of the grains to satisfy US demand.

Turns out, that’s not exactly the case…

On Monday, investors found the 2014 US corn crop is estimated at 91.7 million acres.  That’s down 4% from last year and down 6% from 2012.  What’s more, if the USDA’s estimate comes to fruition, it will be the lowest planted acreage since 2010!

Look at what the news did for prices…

Corn

As you can see, there was a very bullish reaction to the USDA’s report.  Yesterday’s intraday high of $5.12 a bushel was the highest price for corn in nearly eight months.

And that’s not all…

The USDA also reported that US corn inventories are sitting at around 7 billion bushels.  And while that’s 30% higher on a year-over-year basis, it is 90 million bushels lower than investors were expecting.

Clearly, there’s a bullish story developing in corn.

But don’t forget about soybeans…

Investors found inventories of this essential crop are also lower than expected.  The USDA revealed stocks stored on farms are around 382 million bushels- that’s 16% lower than a year ago.  

The news sent beans surging to 8-month highs at $14.83 a bushel.

Take a look…

Soybeans

After a multi-week consolidation, which had soybeans trading between $13.75 and $14.50, the commodity is breaking to new highs.  And with the uncertainty of the spring planting season upon us, there’s a very good chance soybeans trade even higher in coming weeks.

What’s the easiest way to capitalize on price fluctuations in corn and soybeans?

The Teucrium Corn Fund (CORN) and Soybean Fund (SOYB) provide investors direct exposure to these essential grains.  When corn and soybean prices rise, so do these ETFs.  And the best part is, there’s no need for a complicated and risky futures account. 

But just keep one thing in mind…

Subscribers to my flagship investing service, the Commodity ETF Alert, were buying CORN and SOYB late last year and into early 2014.  In other words, we were buying grains when the so-called “experts” were bearish.  

And now that the tide has turned for grains, my subscribers are sitting back and watching the profits build in their commodity ETF portfolios!

Until Next Time,

Justin Bennett

***Editor’s Note***  If you’d like to discover how to get into the right commodity ETF before it makes its move, click here.

Tags: , ,

Category: Corn, Soybeans

About the Author ()

Justin Bennett is the editor of Commodity ETF Alert, an investment advisory focused on profiting from the ebb and flow of important commodities via ETFs. The commodity veteran and options specialist is also a regular contributor to the Dynamic Wealth Report. Every week, Justin shares his thoughts with our readers on a variety of commodity-related topics. Justin is also a frequent contributor to Commodity Trading Research’s free daily e-letter. And he’s the editor of another highly successful and popular investment advisory, the Options Profit Pipeline.

Leave a Reply

Your email address will not be published.