When days get long and time gets short, key details can slip through the cracks. A low-tech solution is a to-do list. In addition to timely chores, this lineup can help make sure you’re not slowed by fast-moving markets.
Staying on top of the futures game may seem either too easy or too hard. Sure, you can get the latest headlines with a swipe of your finger, but digging deeper can open rabbit holes that are hard to escape. Knowing what to check, when to check it and where to find it can give a new meaning to IT.
Items on this checklist will vary depending on location, size and finances of each business. Here are some to consider.
Where to get new data and when
Crop progress: Crop progress reports provide a snapshot of several thousand fields around the country, detailing how conditions and the pace of operations compares to the previous week, year-on-year and the five-year average. After emergence, crops are rated on a scale from very poor to excellent, which provides a key clue about yields.
By the time combines roll full-tilt, conditions predict more than 90% of the variance in yields for both crops. But ratings are one of the best tools available for forecasting yields much earlier, with predictive power for corn peaking in mid-July. Soybean ratings take a little longer to gain statistical traction, offering a heads-up about where USDA may land in its first production forecasts in the August World Agricultural Supply And Demand Estimates.
If 65% or more of corn fields and 60% to 65% of soybeans are in Good or Excellent condition, the crops could be big.
- Whether it’s planting, growing or harvesting, these weekly updates come out at 3 p.m. Central most Mondays.
Vegetation health index: While Crop Progress provides readings down to the state and district levels, VHI is based on satellite imagery on a much granular scale.
Results correlate well with yields as soon as early Jun. Users also can select other countries to see tracking for a variety of crops around the world.
- Weekly updates generally are provided by Wednesday, with an archive of data going back to 1982.
Drought monitor: This tool provides a handy snapshot for long-term as well as short-term drought across the U.S., including outlooks and details on affected row crops, specialty crops and livestock. These in turn can be correlated with yields to provide another forecasting method, with an archive going back to 2012.
- Results are posted Thursdays.
El Nino/La Nina: The El Nino/Southern Oscillation Index is one of the most hyped climatic tools. Click-bait headlines are usually overblown, but the warming and cooling cycle of the equatorial Pacific is useful as both an early warning and production forecasting system. Best to forget about boom or bust extremes — weather is complicated, and the ENSO is full of grey. Readings go back to 1950, covering the lifespans of most farmers around today.
- Look for updates weekly and mid-month.
Where to get essential data any time
FedWatch: Like it or not, trading in financial markets often spills over to commodities, and Wall Street action often swings around interest rates. While the market in theory sets conditions for longer-term loans, the Federal Reserve controls short-term rates directly with its targeted range for Federal Funds. Traders’ bets on Federal Funds futures provide a glimpse into how the supposed “smart money” feels on a real-time basis, including odds for rates up to two years into the future.
- Comparing these to forecasts from Fed officials and analysts provides a guide to how the market is leaning headed into key events.
FRED: FRED isn’t the name of your boisterous neighbor who yells “Yaba-daba-doo!’ The acronym stands for Federal Reserve Economic Data, a statistical warehouse from the U.S. and other countries around the world. Want to know how the latest reading on China GDP growth compares to the past? Query this database and the details will pop up, including charts that can be downloaded or modified with other metrics.
- The Fed also providesdetails on the TreasuryCurve, showing rates of various maturities.
QuikStrike: The devil is often not only in the details, but because of them. Many parts of the market offer a blizzard of quotes and data, and options can be especially hard to track. This tool from the CME, parent of the Chicago Board of Trade, is a handy place to find facts about implied volatility, delta and other “Greeks” to help guide informed decisions and make simulations of outcomes.
- Remember, managing risk isn’t about picking market tops or bottoms, but making decisions that work best for your business.
Fertilizer futures: Futures started with corn and soybeans and spread to Treasuries and stocks. These days if you can buy it or sell it there’s likely a futures contract to use.
Fertilizer listings have been around for years, not generating much interest until prices skyrocketed this year. Urea and phosphates from the U.S, the Middle East and South America are listed.
- Even if volumes are light, daily settlements provide a guide for what may be happening with your local market — which means another basis to track.