A drop in crop condition ratings and early results from the ProFarmer Crop Tour had the markets higher overnight, but have since lost that strength. The corn market is currently down 4 with soybeans unchanged.
The tour reported 154 bpa for both S. Dakota and Ohio on their first leg. This was off 6 bpa for Ohio and 3 for SD from last week’s August forecast from NASS. Soybean pod counts disappointed as well with S. Dakota coming in at 833 versus 1024 last year and a 3-yr average of 965. Ohio’s pod count was off even more with just 764 pods versus 1248 last year. For some perspective, Ohio’s 3-yr average sits at 1137.
August is nearly over and maturity seems to be a major concern for the surveyors on both legs of the tour that may leave some farmers hoping for higher temperatures to try to help push these crop over the finish line. Today the tour will be checking fields in Iowa, Minnesota and Indiana as they work their way to middle and hold their meeting on Thursday to release their final yield estimates.
Unfortunately for producers with unsold old crop and unpriced new crop the biggest issue is demand! Regardless the size of this years crop, exports have been poor and domestic demand is diminishing daily with poor margins. Every week we hear of more ethanol plants that are slowing down or shutting down until things turn around. Unfortunately the turn around doesn’t look like it will be anytime soon!
I would advise producers that are sitting on old bushels that need to move before harvest to lock in basis very soon. Once the calendar turns to September the gates will open regardless of cash prices as most producers and elevators will empty out their remaining stock to make room for this years crop. Producers needing to make new crop sales should consider making fall basis sales vs. the CH to give them a little more time to market once the crop is in the bin.
Have a Safe Day!