Soybeans battle the 'bears'
Soybeans, and to a lesser extent corn, have come under selling pressure lately, as we warned last week in our weekly commentary.
Indeed, private estimates of 2012 crop size continue to come in larger than the October report from USDA for both corn and soybeans, and South America weather has improved as we indicated last week. Recent private estimates of US yields for the November USDA report showed improvements in both corn and soybeans, with Informa at 122.4 bu/acre corn (up 0.4 bu/acre from USDA October), and soybeans at 38.6 bu/acre (vs. USDA Oct. at 37.8 bu/acre). FC Stone numbers were at 124 bu/acre corn and 39.1 bu/acre soybeans. Pro Ag estimates are at 39 bu/acre soybeans, but our corn estimate is lower in November at 123 bu/acre, up only 1 bu/acre from October. USDA is still too low on ND (who probably has record large corn yields in 2012 with the Pro Ag estimate 135 bu/acre vs. 115 from USDA in Oct.) and MN, but recently they have just cut ILL yields to offset any changes in northern Plains yields.
Pro Ag would not be surprised to see northern Corn Belt states corn and soybean yields hiked in this report. ND farmers will
really cash in for 2012, with a record large crop of wheat, corn, soybeans, and many minor crops along with a record high price! US harvest progress is rolling along at very strong levels, much ahead of the normal level in almost all crops. The corn harvest is now at 95% complete vs. 71% normally.
Soybean harvest is 93% complete vs. 86% normally. Sorghum is 78% harvested vs. 70% normally, as with corn and soybean harvest nearly complete, farmers can focus on finishing up sorghum harvest.
Sugarbeets are 91% harvested vs. 92% normally, and sunflowers are 88% harvested vs. 60% normally.
Overall, it has been a great harvest for US crops, with early harvesting of virtually dry crops (a lot due to the dry/warm weather this summer). Winter wheat is 92% planted vs. 90% normally, with germination now catching up to normal at 73% vs. 74% normally. But conditions declined as Pro Ag predicted as little rain fell in winter heat country last week, so that we dropped 1% in conditions to 39% G/E. The winter wheat belt is in need of more rain, and little is really forecast for western HRW wheat areas which are the driest.
The US election took place Tuesday, with Democrats holding the White House and Senate in spite of a pathetic economy, with tight margins of victory in the US Presidential race. That will likely boost commodities as a more inflationary policy, with larger deficit spending is likely to occur over the next 4 years. However, with our poor economy currently, that may be appropriate for now while the economy is still so fragile.