Weekly Crop Commentary - 8/26/2022

Aug 26, 2022


Ed Nienaber
Vice President, Grain Division
The grain markets are finding support this week as we reach the final Friday in August. The rain in the southeast and Delta has delayed harvest. This, in conjunction with the Pro Farmer crop tour, is bringing buying back into the corn and bean pits. We are currently trading forty to fifty cents higher on both commodities for the week. Basis has also been supported by demand for old crop bushels as we continue to bridge the gap to harvest. Southeastern corn harvest delays have kept the rail markets stronger than normal for this time of year. Also, beans seem to be running out as processors and river locations for export continue to search for cash bushels.

The USDA weekly crop condition is relatively unchanged, with our crops rated at around 60% good to excellent, but I am sure my colleagues will fill you in on this week’s Pro Farmer crop survey. Private forecasters will release data in the coming week, with StoneX expected to be released next Thursday. We are anticipating the USDA to adjust the supply/demand number on their update on September 12. Have a great week and enjoy the weather as we approach Labor Day weekend - the unofficial final days of summer.
 
Wes Bahan
Director of Grain Purchasing
Good afternoon. Well, it is the final Friday of August and yet another month has absolutely flown by. As you all are probably aware, there was a crop tour going on this week. We have been mentioning that the crop condition ratings and the big USDA yield number were aligning. The tour pegged the Ohio corn crop at 174 and change, 16 bushels below the USDA. Combining that with the fewer planted acres could lead to a 90+ million-bushel reduction from last year. The tour does not do soybean estimates, but pod counts have been lower than last year.

Cash corn and bean basis this week has been mostly steady, but as harvest draws near, we will continue to see weakness. The bounce in the futures market did provide an opportunity for farmers to sell corn above $6 and beans above $14 again. With the rains that fell last weekend, farmers felt better about adding to new crop sales and catching things up a bit. As always, have a great weekend as we only have a few of these summer weekends left.
 
Lou Baughman
Grain Merchandiser, Kenton (Region 1)

Markets recovered today after Thursday’s sell-off. The Pro Farmer Tour influenced the market this week, questioning the supply, but the lack of US exports makes for less demand. Pro Farmer will have the official numbers after the close today. If you still have unpriced old and new crop grain, keep a close eye and reward the market on these upward moves.

More rains are expected next week to help fill out the beans. Corn is looking pretty good also, but I don’t think it will be as good as last year. Have a nice weekend. 

Haylee VanScoy
Grain Merchandiser, Upper Sandusky (Region 2)
The Pro Farmer crop tour finished up yesterday in Iowa and Minnesota, and their final numbers will come out at 2:30 EST today. There were concerns right off the bat on Monday as they started in the far west and far east resulting in lower yield estimates than anticipated, but as the tour made their way toward the central Midwest and saw better crops, the market reacted accordingly and backed off yesterday before finishing on a strong note today. If you still have old crop bushels to price, I would suggest taking advantage of this late summer rally to price $7+ corn and $15+ beans. 

Reminder that we rolled our old crop basis for corn and wheat to the December futures this week and will continue to see the basis weaken as we get into September next week. New crop corn and beans have made a good recovery this week as well, and I would encourage you to evaluate your current sales and see if you need to add any more to the books. Also, it wouldn’t hurt to start looking at a small percentage of new crop 23 sales or have offers in as we get into harvest since it will be here before we know it. Hope you all have a great weekend!
 
Lisa Warne
Grain Origination, Mechanicsburg (Region 3)

Happy Friday! All eyes have been on the Pro Farmer Crop Tour this week. Their observations in the Western Corn Belt along with Monday evening’s crop condition ratings helped rally the markets this week on supply concerns. New corn reached levels we have not seen in two months and new soybeans one month. Local farmer selling picked up on Tuesday and Wednesday, with growers taking advantage of the rallies.
 
On Monday, Pro Farmer estimated South Dakota corn yield down 26% from their three-year average, while Nebraska is estimated down 10% from average. For soybeans, SD pod count is down 19%, and NE down 14% from average. Also Monday, the U.S. corn condition ratings dropped another two points to 55% Good/Excellent when trade expected it to stay steady. U.S soybean condition rating declined one point to 57% G/E.
 
Focusing on Ohio, the Pro Farmer tour saw a decline from last year on both corn and beans by 5-6%. However, comparing this crop to the three-year average, corn yield (174.2) is about 3% better, while soybean pod count (1131.6) is about 9% better. These figures match crop condition ratings - lower than last year, but better than average. USDA has Ohio corn denting at 23%, on par with average.
 
Pro Farmer wraps up their final tour results and production estimates this afternoon, right after the market closes. After this tour, the question is whether the better-looking areas will carry the poorer areas to meet U.S. supply needs. Have a great weekend!

Steve Bricher
Grain Operation Manager, Urbana (Region 3)
Next weekend is already Labor Day, the end of summer. I see school buses running, so I know most of the kids are back to school. I do not know where the summer went. I think as we get older, the days go slow, and the years go fast.

The markets saw an early week recovery as the Pro Framer tour saw poor crops in the fringe areas. They pegged the Ohio corn crop at 174 versus last year at 185. The pictures I have seen from the tour show a more varied corn crop than last year. Generally, the crop is not as good as last year, with the exception of Minnesota. 

This morning, I read that Arlan Suderman with Stone X estimates national corn yield at 171.8 and soybeans at 52.0. These are not numbers that will set the world on fire. We will have the final national estimate from Pro Farmer by the time you read my comments.

This will not be a record crop, so we will see how demand holds up and how the general world economy creates demand for our corn and soybeans. If you have any old crop corn or soybeans left, the rally has given you an opportunity to get them cleaned up. We keep seeing the basis between old and new narrowing. Look at your new crop sales and what you believe you will have to sell. Today you can get over $6.00 for corn and $14.00 for soybeans. Those are numbers we would have sold the farm to receive in years past. We need to keep in mind that with everything going on in the world today, these prices can change for the better or worse in a minute.

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