MarketsFarm – With United States soybean and corn harvests nearing completion, anecdotal reports point to better-than-expected yields for both crops that could weigh on futures prices at the Chicago Board of Trade.
“It’s amazing that here in the U.S. we have a good corn and soybean crop, considering how dry we were,” said Scott Capinegro, of Barrington Commodities, a division of HighGround Trading in Illinois.
The U.S. Department of Agriculture releases updated supply/demand estimates on Nov. 9 and pre-report expectations are for upward revisions to production and ending stocks for both crops.
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“The rule of thumb is, when carryouts grow that should be on the bearish side for prices,” said Capinegro.
Solid crop prospects out of South America, with soybean seeding in Brazil running ahead of normal, could also weigh on the Chicago futures.
On the other side, recent strength in both vegetable oil and crude oil has lent some support to soybeans and corn, with prices for both crops well above average. However, while prices are strong, farmers appear content to hold off on selling for the time being.
Capinegro expected that selling could pick up over the next few weeks, as on-farm storage fills up after the better-than-expected harvest.
Looking farther ahead, “fertilizer costs are sky high,” said Capinegro, noting that input costs could lead to some adjustments in seeded area next spring.
