What to Know This Week: Near-perfect Weather, Crashing Prices
After recent USDA data showing strong crop prospects moving through summer -- and weather in the last week to support that idea -- the grain markets have spent the week riding the bears. What it will take to spur the bulls back to life's been just one of the week's big news. See what else you need to know in ag this week.
The corn and soybean crops are "off and running" in the Corn Belt, with some states' crop ratings higher than they've been in almost 3 decades. Check out these shots from around the nation's center, including the northward-marching winter wheat harvest.
Seventy-five percent of the nation's corn crop is in good or excellent condition, according to Monday's USDA-NASS Crop Progress report. Soybeans were identical in their rating from one week ago, with 72% in good or excellent shape.
The news earlier this week that cooler temperatures and moderate dampness will continue through the end of this week or so doesn't likely mean conditions like flooding and continued standing water in fields will necessarily get worse, weather experts say. In fact, many Midwest rivers that were flooded earlier have now receded to more normal levels.
"Weather forecasts are perfect for the reproductive stage of development, with the next two weeks forecast to have mostly normal to below-normal temps and normal/above-normal precipitation," one market analyst said this week. "That means that yield potential of corn and soybean crops will continue to jump rapidly, meaning more projected carryout and thus, lower prices are likely ahead."
So let the rumblings begin. "Is it 'game over' for these markets, for now?" one farmer wondered last week. What do you think? Join this conversation now and share why you think that's right or wrong.
What's the view from the trading floor in Chicago on this topic? The bearishness is heavy this week, and Agriculture.com analyst and broker Scott Shellady says the "bears are in charge" and prices in the $8 range for soybeans and $3 range for corn could be in the cards. Ouch.
"My bet is we have a hard time marketing at a profit. Breakevens may be down a little but not much. Income will be down substantially," one farmer said this week in Marketing Talk. "Where are you putting your 2015 bets?" So, what about you?
So, moving forward through to mid-July, will this summer's weather support a bin-buster this fall? With continued cooler-than-normal temperatures, it could be in the cards for some farmers in the Corn Belt, farmers and economists say. What do you think?
With crop conditions looking as good as they have in decades in parts of the Midwest, grain prices are getting slammed.