Iowa Public Television


Bulls Return To Trading Pits

posted on July 5, 2002

Hello, I'm Mark Pearson.

Flush from the celebration of the Fourth, the nation's financial community seemed more confident at week's end. News of higher factory orders and implied assurances the Fed will not raise interest rates pushed stock indices sharply higher on Friday. There also was word the Securities Exchange Commission will now require CEOs of the nation's largest 947 companies to swear to the veracity of financial reports. Investors see that as an important first step to restoring market confidence.

For producers of commodities, the story is somewhat different. Markets are moving higher as confidence ebbs about the availability of grain and oilseeds.


Bulls Return To Trading Pits

The Holiday shortened trading week gave grain and oilseed traders a brief respite from the first serious bull market in years. News of the drought in the western Corn Belt and reports of meager yields from the winter wheat harvest have pushed prices sharply higher. In the last two weeks wheat prices have soared 14 percent.

Planting delays began to nudge corn prices higher in the spring. Hot dray weather accelerated the climb. Futures contracts for a crop that is becoming more stressed are now priced 25 percent higher than before planting.

The story is much the same in the soy complex. News that American soy ending stocks could hit a 6 year low has encouraged buying of beans, meal and soy oil.


Tags: crops drought markets news weather