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Corn, Soybean Balance Sheets to Juggle, Successful Marketing Newsletter Says
I was visiting with a longtime client after a meeting in late February this year.
The topic of the conversation was how do we fix the oversupply problem the U.S. is facing for grains.
At the time, the popular comment was “low prices are the cure for low prices,” which can be translated to mean that low prices will attract higher demand (through exports and consumption). I can say with high confidence that nearly no one was thinking we could fix the oversupply problem with excessive rain, flooding, and very wet forecasts that would limit planting progress across the entire Corn Belt.
Check out this week’s Successful Marketing Newsletter.
The Planting Progress report released Tuesday afternoon showed the U.S. corn crop was just 58% planted. That compares with the five-year average of 90%.
This progress report suggests that we have 39 million acres of corn that still needs to be planted. The forecast for the next seven days is not ideal for a large leap, allowing the U.S. farmers the planting window needed to catch up.
Soybeans are also falling behind, as the report stated just 29% of that U.S. crop has been planted. The five-year average is 66%.
Check out the full Successful Marketing Newsletter to see what traders will be watching for in upcoming weekly reports.
Can November soybean futures prices return to double-digit prices? Two weeks ago, the answer would have been overwhelmingly no. Ask that same question today, and you may get a different answer.
So, what has changed in the last 14 days?
Traders are realizing that Mother Nature isn’t just slowing down corn planting, she is doing the same for soybean planting. The days of double-digit prices for November 2019 soybeans are getting closer, especially when prices gap higher in back-to-back trading sessions.
Check out the full Successful Marketing Newsletter to get the next upside targets.