Corn is up 2 and soybeans are up 7 to start the day. Yesterday’s report gave the markets a good boost which producers heavily rewarded by making very good sales for nearby thru fall of 2021. With the run up in board prices over the last couple weeks and locally better than expected yields we are starting to see nearby bids pulled from end users and basis weaken a bit in the deferred months as needs get filled. I would recommend that if you are going to need to sell corn in Q1 that you make some sales to lock in a great price and assure a space to move the grain.
Yesterday the USDA estimated US 2020 corn crop near 14,507 mil bu. Total 2020/21 corn demand is estimated near 14,825. This includes exports near 2,650. Carryout is now estimated near 1,702. This suggest corn prices may need to trend slightly higher to slow demand and help increase US 2021 corn acres. The 1,702 carryout is a 11.5% stocks to use ratio. Historically the CBOT does not trade above $4.50 unless we see the stocks to use ratio below 9%. I am not saying this couldn’t happen, but we still have a lot to work thru to get to 9% and with COVID numbers and shutdowns around the world on the rise this number could easily go the other direction. Projections for average on farm prices for 2020/21 are $4.00.
USDA estimated US 2020 soybean crop near 4,170 mil bu. Total 2020/21 US soybean demand is estimated near 4,519. This includes exports near 2,200. Bean demand and carryout of 190 million bu. were the biggest market mover in grains on Tuesday. Projections for average on farm prices for 2020/21 are $10.40.
Have a Safe Day!