Weekly Crop Commentary - 1/5/2024
Jan 05, 2024
Grain Merchandiser, Kenton (Region 1)
The markets this week have not been interesting at all. The only thing that sent a spark, was a rumor that China purchased some wheat. There will be a USDA report next Friday I don’t have a warm and fuzzy feeling about the results that will come from it. In case there is a surprise, think about what you would like to sell, old and new, and put some target orders in just in case there is a bounce that very possibly could be short lived.
Grain Merchandiser, Upper Sandusky (Region 2)
Good afternoon and happy New Year! Hope everyone took time over the holidays to spend time with friends and family! Market has not been kind so far this new year. Old crop beans are down 40+ cents and old crop corn is down about 10 cents. We are nearing numbers that start with 3s and 11s for old crop, no one is excited about that.
The thing with these low prices is that I don’t really see an end in sight. Corn wise there is almost zero upside news. Poor exports and better than average yields for the country is expected are pushing our carryout and supply numbers to levels that do not support high prices. Chances are we are going to plant 90+million acres of corn as well this coming year, and that will only add to the large carryout number. Bean wise, there’s some upside potential in Brazil with their drought and now hard rainfalls. Problem is, looks like Argentina is going to make up for the loss in Brazil and then some. The problems in South America do have the potential to allow us to be more active in the exporting game which could lead to a little better prices. Question is how high can beans actually go after the tumble they’ve taken that past month.
Corn next year is looking at the 4.50-4.60 cash range the past couple of days. Might not be a bad place to start, especially if you are looking to minimize your risk and lock in some profitability. New crop beans are below 12.00 now, and with the bean volatility it isn’t a bad idea to get targets going for 12.00 or 12.25 to grab some of that upside if the time ever comes around. As always give us a call to talk through options for stuff in the bin or for 2024 crop. Thanks and have a great weekend!
Grain Operation Manager, Urbana (Region 3)
Happy New Year, or maybe just welcome to the new year. We have turned the calendar to 2024 but we are seeing some of the same issues we had toward the last half of 2023. I could put a list together of all the bearish things in the market today but I do not want to take up a page and a half of the comments. The best way I can put it is not good from a demand side of the markets today.
If you have read my comments over the years, I try not to get caught up the weekly news flash that is front and center for the week. I try to stay with the basics and not get caught in the noise, because most times someone that is making the noise has a reason or a position, as to why they are making the noise. I always get back to supply and demand, and today we have more than adequate supply, and demand is being tempered by economic problems in several countries around the world. That is not to say this cannot change, but this takes time to work itself out.
So, I know the next question I am going to get is, so what do I do? You must be realistic on how much these markets are going to move. The farmer today controls more of the grain available to the market then ever, as you have expanded his on-farm storage over the last decade. So, it will be a tug-of-war between the end user and the farmer on trying to get the grain to move. The end user knows the grain is out there and they know the farmer must move it sometime, the tug is getting you to move it when they need the grain.
If you want or need help making a selling decision, that is where we can come in. We can look at different options to help you. Some are as simple as setting reasonable price targets and others maybe looks at different option strategies to possible improve your final price.
Welcome to 2024 and the wild ride that it is going to be.
Grain Merchandiser, Marysville (Region 4)
Welcome to 2024! Not much to get excited about so far when it comes to the grain market. Corn has lost about a dime this week, while soybeans have lost nearly 40 cents. Wheat has fared better, only down a nickel. Speaking of wheat, if the $6 level for next July interests you, please be sure to put an offer in with one of us.
Logistics the last couple weeks have not helped export potentials. The Panama Canal has been facing low levels for some time. Another major thoroughfare is the Suez Canal in the Red Sea. The largest container shipper, Maersk, paused all transits through the area as one ship has been attacked by militants. Going south around Africa adds freight costs and time. Two weeks ago, I mentioned the rail crossing closures at the Texas-Mexico border. Luckily those were reopened after 5 days of being closed.
This week we updated our Delayed Price (DP) rates for new deliveries. Here for the western branches, we have removed the $0.10 flat rate and are now just $0.10 per bushel per month, pro-rated daily. Have a great weekend and go Washington Huskies!
Grain Merchandiser, Canfield (Region 5)
Good afternoon, Happy New Year to everyone. The markets have not been our friend since the start of the New Year. Corn and beans have fallen off this week. One of the biggest USDA Reports of the year comes out next Friday Jan 12th. The Jan report has been noted for some big changes at times, but I am hard pressed to find anything bullish is going to come from this report. South American weather this week has been very good. Only about 15% of Brazil’s soybean acres have not seen some good rain coverage. That’s been the main factor for the pullback on soybeans. Yesterday there was a little chatter that China may be looking for some more wheat out of the U.S. and that helped the wheat market to close higher and also keep some support under the corn market. I hope all of you are doing well and are looking as forward to 2024 as I am. Have a great weekend!!!!