Weather damage is a difficult one to rationalize, particularly in a wheat crop that is towards the end of maturity. I have seen many attempt to predict the impact of the excessive moisture the HRW belt has experienced over the past few weeks and what is forecast into next week. First of all, the damage in the SRW belt is meaningfully different – the damage through abandonment and yield loss is all but confirmed and traders are working off production numbers under the USDA May 1 estimate. HRW isn’t as clear. Given the crop is later than usual, Kansas is 61% headed vs 82% average, yield loss is hard to ascertain and is probably too early to predict. There are a few anecdotal years that suggest we could take up to 5bba off the latest estimate based on received rainfall which would result in a loss of just under 100mbu – not a balance sheet shifter just yet. However, the patterns we have been seeing suggest we are not out of the woods – there was over 30 tornados reported just yesterday, with 130 reported in the last 5 days in central US.

Corn keeps on trucking, albeit with a little less sting. Patterns still have plenty of moisture built into the nearby, although the longer range outlooks are more mixed with some even showing things drying out slightly. Weather markets… interestingly the noise around a possible bail out by the Trump administration to compensate for the ongoing trade spat between the US and China took a turn yesterday when the govt issued a statement instructing the US farmer to make planting decisions on the current market rather than on an assumption of financial aide. This allowed beans to fight back – although it’s hard to see what sustains strength in the bean market outside of the inability of the US farmer to plant – certainly nothing exciting on the demand front.