If you’ve been waiting to see if the corn and soybean markets climb higher, you may be waiting for quite a while—especially for corn prices!

“We’re seeing headwinds across the board for the commodities—not every commodity, but many of them,” according to Arlan Suderman, Chief Commodities Economist at StoneX.

“The general thinking in the markets is with the Consumer Sentiment and Consumer Confidence [indexes] both plunging here over the past month, and with headlines of terrorists and inflation, that we’re going to see economic growth stumble here in the United States, as well as globally, and that’s going to hurt demand,” says Suderman. “Keep in mind that we had a significant rally in the grains and oil seed markets in recent weeks and months, therefore the funds are taking some profits on that rally.”

How’s the overall tone in the corn market?

“A combination of factors are really piling on and now the momentum has turned bearish,” says Suderman. “The dry areas of Argentina have turned wet and now flooding is a concern now. Also, the previously wet areas of Brazil that were slowing soybean harvest and therefore planting Safrinha corn dried out, and so we’re seeing very fast planting of the Safrinha corn crop in Brazil. We also saw that the funds had near-record large long positions or ownership in Friday’s CFTC (Commodity Futures Trading Commission) Report, which made the traders nervous.”

Suderman adds that we could also see a huge increase in corn acres in the Midwest this growing season—which would also add significant pressure on the corn market.

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