Welcome into the Friday, January five, 2024 installment of Market Plus.

Joining us again, Mark Gold.

Mark, New Year, new outlook on anything for you.

Well, the new year always brings hope and hopefully we'll see good markets this year.

Markets that'll sustain themselves.

Hopefully it'll be a demand market rather than a weather market.

To move these crops.

Unfortunately, I just don't see demand being great to start off the year.

Do you see this year as a potential to return to what is more of a traditional pattern of trade?

You know, it's getting to be what's the traditional pattern anymore?

You know, you used to see prices rally between now and July and August and then sell off toward harvest.

It's probably going to be the case, but the carry outs are still pretty big.

You've got a big corn carry out 2-1, 2-2.

It's a lot of corn.

Plus the rest of the world is seems fairly self-sufficient right now.

Yeah, Mexico needs it.

China needs it.

Mexico's been a great partner and I hope to continue that partnership.

I think it's a undervalued partnership to the American farmer.

Well, that story there around Christmas with the border closings and how quickly the commodity groups sent out releases saying this is how much goes across here and there.

And that was a big part of that story.

So I guess that'll kind of lead into our first question.

Let's open up with this one.

Mike in Nebraska wants to know what are the top two things to keep an eye on that aren't government reports or weather related for the next 90 days?

I think you answered one is our trade relationship.

Well, I think certainly the U.S. dollar, it's been so strong and it's been a real drag on our export market.

If we could get the dollar technically under par, under 100 points, then I think we're hopefully going to look at something in the low nineties in the dollar, and that should give us a little boost.

That's a good 10 to 15% drop in the price of the dollar and that should help a little bit.

So that's one thing.

I think the other thing is oil.

You've got the Middle East just teetering on, exploding in a lot of different areas.

You've got ISIS attacking Iran.

I mean, who would have thought that killed 125 people there?

You've got the problems with the Houthi, the gunships in the Red Sea.

You've got Israel and Gaza.

There is one flashpoint after another in the Middle East, and that's where we get most of our oil for the world.

So if that blows up in a big way, then you've got oil that could certainly move to 100 bucks.

Who knows how.

But then the United States has moved into a position that they are an exporting country of oil.

For us, we'll be okay, but the world will cause a recession in China.

I mean, it'll bury the Chinese, in my opinion.

The Russians will make a gazillion dollars off of it.

The Saudis will make more money off of it.

But it's not good for the world if we see that, obviously not good for the region, if we see war there really escalate.

Let's not go war, but let's go other countries with some other calamities.

And that's the weather that's going on there.

But Bradley in Nebraska wants to know how much bigger will the Argentina and Paraguay soybean crop be this year over last year?

Well, I think they're going to have a pretty decent year.

They've had some good rains.

Argentina started off pretty dry and since then they've had plenty of rain.

We really don't see any real weather problems today anywhere in the world.

The weather guy I get comes out with different colors, green, red and yellow, basically.

I'd say it's either yellow or or green.

There's no red anywhere in the world.

Very unusual.

So as far as Argentina, Paraguay go, I think they're probably look at big crops, most likely bigger than I last year.

I kind of got you riled up and corn during the main show.

And I want to know if this question is going to get you riled up and soybeans.

Mark Bryce in South Dakota, The big question, why am I still sitting on my beans?

Why are you still sitting on your corn?

I have no idea why you guys are.

You know, most guys this year sold beans.

Pay the bills, get some money, get some cash.

They did a pretty good job of selling the beans this year.

The corn they sat on, in my opinion, a huge mistake.

But there's still risk out here, particularly because of the funds.

Now, the funds have gotten short beans.

They blown out of that long position, now short.

There's still long that meal.

And I think you're going to take some heat on this until you see the funds maybe get to 70 or 80,000 short beans and maybe short ten or 20,000.

Meal, they're already short 50, 60,000 oil.

So the meal is the last segment for them to blow out of.

Once they do that, then I think you're going to see the bean market rally.

But over the last month or two, you've seen some big losses in the beans.

And I don't see it stopping really until maybe maybe the first the next month.

What's the number on that?

How low?

Yeah.

I don't like to play that game, but certainly another 40 or $0.50 lower in the beans than we are now.

So if I go to an 11 possibly instead of a 12.

Yeah.

And we've dropped probably since 13.

Yeah.

In just a few short days we've lost we've, we're out of the teens.

Yes, that's exactly right.

So that does give you pause for concern.

So, Mark, I'm going to get asked, I'm sure, on social media after we post these comments, they are going to say, well, Mark, you are just part of a big group that's just trying to get the grain off the farmer's hands for cheap.

Well, I'm not trying to get it off the farmer hands to help the commercials so they can buy cheap grain.

Let's be very clear about that.

I don't like storing grain and anybody thats been to my seminars over the last 25 years.

One of the main things I talk about is quit storing grain out here.

And farmers, they were, you know, the prices are low at harvest.

I don't want to sell it.

I'm going to put it in the bin.

Maybe there's a little carry and I have screamed till I'm blue in the face.

The market won't rally until the farmer loses ownership of the grain and the farmer is holding a large cash position.

And we know that because of fund positions excuse me, the commercial positions are as small as they've been in years, which tells us they haven't bought anything.

So I think that's a problem.

And once the farmer gets it out of his hands, then the market can rally.

It's not going to be the commercial screaming and bidding things up.

That's not going to change this.

No opinion nor nor are the funds going to cover an 180,000 short corn until they see the ownership switch, in my opinion.

All right.

I just had to ask I just have to ask them.

I'm saving you and I some work on the weekend.

Thank you.

All right.

Let's continue with our questions next week.

Big report.

Scott in Wisconsin wants to know Mark, January 12, Bear or bull report for grains?

You know, I think the corn market may have a little chance in here.

The beans may have a little chance, only because the carry outs are so low.

Up until this week, we've had fairly decent exports.

The crush is huge on the beans.

I mean, 200.1 million bushels last month did it?

No, but numbers are record numbers.

There's a lot of beans, you know, being used out there.

More and more crushing capacity is coming on.

So I think you've got to be a little careful.

And maybe some of these numbers are start to show up in this report.

So I would say maybe the beans, particularly on this kind of a break, have a decent chance.

You know, we could have another down market for another week and that would be a pretty good buying opportunity.

The wheat market for whatever reason, has put in a good technical close here this week, and I think you have to pay attention to that.

So maybe it's a harbinger that the Wheat Report somehow or another may be friendly, certainly won't be on the export front, but maybe, again, domestically it is.

So I don't like to fight.

The technical is always seen as this kind of a switch out here.

So, you know, I don't think it'll be at this stage in the game with corn on and lows, contract lows.

Are we going to gapped corn open ten or 15 lower?

If we do, somebody is going to step up and buy it.

Well, part of your answer ties into this next question in a way.

Chad in Minnesota says, I'm only selling enough to keep the lights on via puts on beans.

Should I keep letting it slide?

And he's wanting to know about March specifically March puts.

Well, you know if you've got those march puts on you know at some point depending on what you spend for those puts and what strike price you got it at.

If you can start doubling or tripling your money on those puts, it's certainly time to look at rolling them down, taking some money off the table, but keeping a floor underneath you because these markets have proven time and time again, we don't know how low low is.

And to say, okay, I'm going to make a stand here.

Take off your shirt, take off your long puts, cover it, and then hope that the bottoms in generally isn't a good move.

But we've had a lot of success over the years.

And in top third is rolling these puts down.

It doesn't look any low.

If I can go any lower.

Okay, we'll take the money off the table.

We can put on a different level of protection in case we do go lower.

And I can't tell you how many times those second puts will even pay off.

Mike C. I want - I'm not going to put up your question, but Mike, look at the market analysis segment, the beginning of this market plus.

Very good question there.

But let's take corn in a different direction here, Mark, with Tim's question that came in.

This one came in via Facebook.

Is there still an opportunity to capitalize for corn going into spring?

I'm not sure what you mean by capitalized.

Well, is there a way that you can strategize on anything that's happening, whether it's the report or it's weather?

You know, I would be looking to sell any rally in the corn market until we see that shift of ownership, because I just don't see it as this rally being sustained until that happens.

I think Brazil is pretty much out of the out of harm's woods and it comes to the corn.

Now, I think the crop will be pretty good.

And then we need to see demand, which we haven't really seen all that much of.

So if the report tends to be bullish, that may be an opportunity to lighten up.

I'm guessing he wants to know this because he's got a lot of corn in the bin.

As we've talked about three times now.

And I think you've got to be looking for opportunities to sell that corn and then look at buying call options.

Given what you're saying about South America and the window that what we watch, what we call the weather window, where the volatility is the highest, that is almost closed.

Yeah.

What you're saying.

So does that mean that we will see less volatility in the trade here in the next 2 to 3 months?

No, I think we're going to see more volatility.

Why?

World situation.

The wars both in Ukraine and in the middle East, the dollar, if you look at, you know, some of these commodities just in this last week, crude oil up two or $3 a barrel, down two or $3 a barrel.

Silver up a buck and a half, down a buck and a half.

The bond market making new highs and then breaking four or five points.

I don't think this volatility is going to stop anytime soon.

And with the weather and with the wars and with the politics, I don't see I think this is going to be a very interesting year that you need to look to take advantage of those opportunities when they present themselves.

Print out Mark Gold's commentary and we'll hold you to it next time you come back.

How about this?

Love to.

Good to see you.

Good to.

See you.

That's Mark Gold, everyone.

Next week, we are going to take a deep dive on several big government reports, both here and abroad, with Naomi Blohm and Matthew Bennett.

Thank you for joining us.

Have a great week.