With transportation issues at most Gulf ports making progress in resuming grain shipments, following a shutdown from the recent Hurricanes, the market focus will turn quickly to harvest activity and its pressure on corn and soybean prices, analysts told Agriculture Online this week.

Grains such as corn, wheat, and sorghum are exported from Texas ports. The Port of New Orleans handles a large percentage of U.S. soybean exports.

Sid Love, Kropf & Love Consulting Services LLC. in Overland Park, Kansas, said Monday any hurricane impact on the market is fading.

Continue article

ADVERTISEMENT

"I think the market-watchers are going to start thinking exports are going to be all right from here on out at the main ports in the south."

On Monday, U.S. Coast Guard officials opened barge traffic through the ship channel at the Port of Houston. In addition, grain barge traffic has resumed at the Ports of Beaumont and Corpus Christi, Texas.

"Barge traffic is not impaired anymore," said Dana Warr, U.S. Coast Guard spokesperson. "The only restriction right now is that vessels can only operate during daylight hours in order to stay clear of any hidden material in the channel."

With Hurricane Rita lessening in strength and veering to the east, the Port of Galveston sustained what is believed to be only minor damage to its facilities. At the Port of Galveston, grain is the largest export commodity.

With the city of New Orleans beginning to re-open to its residents, Love sees the Port of New Orleans getting back to full operation quicker than thought.

"Because of the fact the elevators are located at higher elevations, and the plain desire of the exporters to get grain down the river and get it gone, I see that port getting back to normal," Love said.

The Port of New Orleans is expected to be 80-100% operational by March, according to a release from the American Association of Port Authorities.

Don Roose, U.S. Commodities, West Des Moines, Iowa, said Hurricane Katrina and Rita gave the market a hiatus before it went lower and now harvest activity will test prices.

"There is a lot of harvest left and we still have to prove we can tuck this crop away from the market and farmers aren't going to put it up for sale," Roose said.

On Monday, USDA's weekly crop progress report indicated farmers have harvested 19% of the nation's soybean crop and 18% of the corn crop.

With full attention on harvest activity, Roose said market pressure is expected on corn and soybeans.

"Last year we went to $1.91 per bushel on Dec corn, Sept corn went off the board at $1.95 1/4. There's no reason to believe we're not going to go down and test those areas unless the producer can keep the grain off the market.

Roose added, "It's like a card game. You don't really know but it looks like the producer will be content in harvesting his crop, taking the loan deficiency payment, hold the grain until a price swing."

In the near term, Roose sees the market tipping the $2.00 per bushel scale on corn while soybeans visit the $5.47 3/4 per bushel area.

On Monday, corn futures prices on the Chicago Board of Trade closed 1/4 cent lower at $2.04 1/4 per bushel. Soybeans finished $0.02 lower at $5.65 1/2 per bushel.