Harvest wraps; focus turns to demand
Farmers have the 2011 U.S. soybean crop whipped, and the corn crop's not far behind.
It's not what Monday's USDA-NASS Crop Progress report shows that's the story; it's what it doesn't show. Monday's report lacks a soybean harvest progress table, indicating farmers have reached the finish line. And, the corn crop's not far behind: 96% of that crop's in the bin nationwide, with only Ohio, Pennsylvania, Michigan and Colorado farmers further than 10% away from completion. Usually, 88% of the corn crop's still standing in the field.
Now that harvest is essentially in the books for this year, farmers are turning their attention to how and when they'll market that grain...that is, if there's any still left in on-farm or local cooperative storage. Many report empty bins on the farm and co-ops that "look like ghost towns." But, reports from other co-op managers say farmers are holding onto grain more tightly than usual, and that's helping firm up basis levels around the countryside.
"In my part of the world, 2 elevators didn't put any corn on the ground. The local ethanol plants are running 115% to 120% of capacity, so I think the basis will be over the board by who-knows-when," says Agriculture.com Marketing Talk contributor small dog. "Corn is leaving fast and that doesnt count exports."
Meanwhile Monday, the soybean market hit a 13-month low and nearby corn futures traded down below the $6-per-bushel mark, reflecting anxiety driven by the shaky world economy. And, though things are fragile now abroad, there's at least for the time-being some support from continued demand for U.s. corn and soybeans. And, farmers say that should provide at least some support for grain bulls amidst so much bearish global news.
"U.S. demand for grains is great. Hogs are being fed to higher weights. Cattle are consuming more grain since forage is depleted," says Marketing Talk senior contributor jec22. "So until crude drops below $70, ethanol will roll on."
Grain market summary for Monday, November 21