Get Ready for ‘Explosive’ Grain Market as Shutdown Quiets USDA

Dec 31 2018, 11:00 AMDec 31 2018, 11:49 AMDecember 31 2018, 11:00 AMDecember 31 2018, 11:49 AM

(Bloomberg) -- More grain volatility is on the way as a lack of U.S. federal data sends the market hunting for crop information to trade on.

That’s according to Steve Georgy, the president of agriculture broker and advisor Allendale Inc. A partial government shutdown means most key reports -- including figures on export sales -- released by the U.S. Department of Agriculture have been halted. Given the thin holiday trading, last week the dearth of information sent investors to the sidelines, he said.

After the New Year, however, Georgy said traders are going to turn to the media and to Twitter to make up for the lack of government information, and that will lead to higher volatility.

How D.C. Shutdown Will Affect USDA, Government Crop Reports

As funds do their usual start-of-year rebalancing, “a lot of money is going to be moved around,” he said.

“You have nothing that is tangible from the government, and it’s all hearsay, so it’s more explosive,” Georgy said.