The grain markets closed lower this week on harvest pressure across much of the Midwest. Most areas are concentrating on soybean harvest and good progress is being made there. The corn crop is estimated at only 28% harvested vs. 47% on the five year average. Corn finished 8 cents lower on the week and is close to the contract low of $3.425 on the December contract.
Corn exports for this week were quite good, however they are still running about 34% behind last year at this time. The USDA has corn export projected for this year down only 19%. So we do have some catching up to do but it is early. South American corn is a less expensive source of corn than the US right now. Argentina is expected to plant as much as 10% more corn acres this year.
There are lot’s of stories out there about elevators getting plugged up with soybeans in Central Illinois and Nebraska. Harvest has been at a torrid pace and yields are coming in better than expected. The US farmer is continuing to sell soybeans across the scale for cash flow and storing corn. The Brazilian farmer was selling soybeans today as well with the stronger US dollar helping their cause. None of this is really bullish for soybean price at the moment. The only bullish story in soybeans right now is the weather in South America and parts of Brazil remain quite dry. The weather forecast is improving but it is definitely worth watching. Brazil is about 20% planted on soybeans vs. 29% on average partially to farmers waiting for some rain before they start. Soybeans are down 22 cents for the week.
The cattle on feed report came out after the grain close and was reported at 105.4% vs. 104.6% expected, placements were at 113.5% vs 108% expected, and cattle marketed was at 102.9% vs. 102.6% expected. The placement number is probably a reflection of cheap corn available out there. This could lend some support to corn price and would be considered bearish to cattle prices.
The weather forecast for harvest in Southern Wisconsin looks clear through Saturday. Then rain on Sunday/Monday and then clear for the balance of next week. Tis the season. Be safe.
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