In order to keep the bullish momentum, and prices trending higher, we are going to need more bullish wood to throw on the fire. My fear is there just hasn't been enough bullish wood cut down as of yet to keep us going. I am also fearful that the USDA is going to come along (in the next few weeks) with several giant buckets of water and put out any new-crop flames they may have seen started.
My concern is even if the USDA throws out fairly conservative acreage numbers for 2013 in their baseline report, the trade will simply discount those numbers considering their baseline estimates last year were more than 3 million acres below the actual planted acreage totals for both corn and soybeans. In early February last year the USDA estimated 74 million bean acres; we ended up planting around 77.5 million. They estimated around 94 million corn acres would be planted, and we ended up planting about 97.2 million.
As you can see this will make it hard for the bulls to win any type of debate in regards to acres planted. Which in my opinion is the only "real" debate we can currently have. Yields and final production numbers are simply a crap shoot at best right now. No one has any accurate bets or lines on the weather this far out. Therefore if the USDA comes out with big acreage numbers for 2013 the bears will say, "I told you so." On the flip side if the USDA comes out with numbers below trade expectations the bears will say, "the USDA is playing it conservative, just like they did last year..." Either way I don't like the set-up and suggest getting caught up with your new-crop sales sooner rather than later. Do NOT risk these profitable levels or early sales past this Friday's USDA report! The ride could quickly get much more slippery to the downside, so make certain you are prepared and have taken proper precaution
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