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Weekly Grain Market Recap 10/2-10/6

Oct 06, 2017
A slower than usual grain harvest across the U.S. is still producing impressive yields. Corn and soybean production are still expected to weigh the grain markets down through harvest, but the slow pace is at least supporting the price for now.

The corn market spent another week essentially doing next to nothing. The trading range on corn has been very narrow recently. Traders are still staring great yield reports dead in the eye, but harvest has only progressed 17% entering the week while on average it is 26% complete by now. More rain this week across the corn belt may lead to another slow week of progress when the numbers are updated on Monday. While the slow pace is raising some eyebrows, the ability to harvest corn in the blink of an eye now has the market mostly shrugging it off.

Soybeans road a bit of a roller coaster this week, but finished just slightly higher week/week. Like corn harvest, soybean harvest is also slightly behind schedule right now. Reports from the field still indicate good yields and very low moisture levels, especially in the eastern corn belt. It's very possible that growers there are waiting to see moisture return to increase overall yields. Further west, rain showers are the main culprit for a slow moving harvest. Slow is also the name of the game in South America when it comes to planting pace currently. As we have seen, any little story that emerges there results in market movement in the U.S. In a longer term view, soybean/corn price ratios are still screaming at growers to plant soybeans in 2018. Currently, early estimates are indicating we could see soybean acres in 2018 rise to 93 million. Yes, demand is growing, but is the market ready to support profitable prices with 93 million acres being grown? Stay tuned...

Winter wheat planting is currently at the 2nd slowest pace in the past 20 years. While conditions have been less than ideal, and harvest is slower than usual, it also remains to be seen just how much wheat is being planted. It's entirely possible that much less wheat is actually going in so the "pace" is not accurate. Elsewhere, Black Sea region wheat prices continue to crush the U.S. export program. Not a whole lot of positive news to be gleaned at the moment. However, new crop futures are 40 cents exactly higher than the were a year ago on this date. Producing less is clearly impacting the price of U.S. wheat.

-- -- Disclaimer: The data and comments above are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. Commodity trading involves risks, and you should fully understand those risks before trading.

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