The Trade Will Pick A Winning Weather Model

Start of Business 06/11/18

Planting season has nearly wrapped up, and attention is being drawn to the summer forecast.

In April, USDA meteorologist Brad Rippey forecasted a cooler, wetter eastern Corn Belt which could “influence weather patterns into June and July.”

Now that summer is unofficially here, Tommy Grisafi, risk management broker with Advance Trading, Inc., said that having a hot summer is almost like a “sales pitch.”

“Typically summers are hot,” Grisafi said on AgDay. “Is it possible that the last few summers, the last four years have been abnormally cooler? I don’t see the 2012 scenario right now.”

Looking at the week ahead, Brian Splitt, market analyst with Allendale, Inc., thinks there will be a “big deviation” between the GFS model and the European weather model.

The GFS model is showing higher levels of precipitation while the European model is showing warmer weather and a lack of rain.

“In the next week, I’d like to see which one is more accurate, and I think as we move forward through the growing season, the trade is going to pick a winner and then go with that forecast model moving forward,” said Splitt.

 

Hear what Grisafi and Splitt have to say about volatility and South America on AgDay above.

 

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