Market Commentary > Weekly Crop Commentary - 11/12/2021

Weekly Crop Commentary - 11/12/2021

Nov 12, 2021

Ed Nienaber
Vice President, Grain Division
The grain market this week traded in a very positive fashion post Tuesday’s USDA crop report update. Going into the report the trade was expecting an increase in carryover figures this year on both corn and beans. The report, while it had minor adjustment to the balance sheet, remained pretty much unchanged from October. The neutral report sent funds back into the pits buying commodities once again. As we approach the final bell for the week, corn is trading twenty cents higher, and soybeans have added roughly thirty-five cents for the week. Feed grains this year will continue to keep prices stable as we see wheat trading at contract highs, fertilizer prices in the world soaring, and demand for corn-based products rising. With ethanol margins at pre-pandemic levels and continued talks with China to honor the Phase One agreement, this will support commodity prices moving into the winter. The southern hemisphere thus far has not had any negative weather effect from the current LA Nina weather event. Much of the trade is becoming concerned that our soybean export program this year will be mainly front-end loaded, and China will soon be looking for cheaper beans from Brazil. The next major crop report will be the USDA January final harvest production numbers and supply/demand update. With the harvest getting close to wrapping up we are seeing signs of basis improvement as we move into the second half of November. Please continue to be safe and have a great week.
 
Lou Baughman
Grain Origination, Kenton (Region 1)
The markets gained strength after Tuesday’s friendly production report.  Thursday’s export report also showed strength, helping the beans bounce off their lows.  

Harvest is wrapping up in the area, only a few are waiting for their double crop beans to get ready and a few finishing up corn.  Everyone has been pleased with the yields considering the dry weather in spots.  

Kenton had .4 of rain last night.  Area customers think conditions will be ok to harvest corn tomorrow, so Kenton will be open Saturday to receive grain.   

Lisa Warne
Grain Origination, Mechanicsburg (Region 3)

Corn harvest in the Mechanicsburg area took a giant 30-point gain to 85-90% complete, which is about 5 points ahead of our 5-year average for this time of year. Soybeans are around 95% complete, right in line with average. We received about an inch of rain in the area last night, so most will take a well-deserved break to catch up on other things.

The grain market has had a great week on the heels of Tuesday’s crop report. Corn has gained a quarter on the week, soybeans 40+ cents, and July wheat also a 40+ cent gain since last Friday’s close. Next July’s cash wheat bid was nearing $8 yesterday. If you have wheat planted, please consider placing some target offers to capture these rallies.

The biggest surprise from the WASDE report on Tuesday was a reduced soybean yield of 51.2 bpa, when trade was expecting it to increase. However, they did decrease export expectations, so the bean carryout increased. Corn on the other hand, saw a slight increase in ethanol production creating a small reduction in the carryout number. Have a great weekend and keep an eye out for the season’s first flakes of snow!

Sarah Harner
Grain Merchandiser, Marysville (Region 4)

We have made it through the first week of November with parts of harvest wrapping up in certain areas. Markets are choppy starting the day higher while overall overnight trading was said to be lower. Ethanol is still a driving factor regarding corn with the USDA estimates up 50 million earlier this week. For those with livestock, something interesting to consider with the high demand for ethanol is the amount of whole kernel corn there will be floating around. With taking consideration to your personal breakeven point, taking the $5.00+ corn prices rather than paying the DP rates might not be the worst idea. Beans have shown a mixed trading pattern due to the lack of Chinese demand and Brazil’s high estimated crop numbers. The November WASDE report that was released early in the week surprised a few with the soybean yield reporting slightly lower. For those with beans still out there not on contract, taking the cash price here as well might turn out to be the better choice with rumors of many planting higher bean numbers than normal. July 22 wheat prices continuing to stand on the stronger side with world wheat quality still being an issue. With that being said we still have a lot of time to see how our winter wheat crop turns out. We are at the point where many are getting tired and worn-out but stay strong on your safety practices to end the 2021 harvest on a positive note! As always keep in mind your 2022 growing season input costs and various market factors that could affect fall 2022 prices! Feel free to contact myself or another merchandiser with marketing questions and contract needs.
 


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