On the heels of yesterday afternoon’s crop progress report, our markets are finding some support in deteriorating good-to-excellent ratings. Nationally, corn conditions fell to 62% G/E (64% LW, 69% LY), and soybeans were lowered by 3% to 57% G/E (60% LW, 72% LY). The trade expected yesterday’s numbers to come in unchanged to slightly higher coming off a week that gave us cooler temperatures and a little moisture here and there. Shockingly, many of the key corn belt states found their ratings slipping week over week as the “I” states were lowered an average of 4% on corn ratings and 3.5% on beans.
Remember, the USDA already took our ending stock numbers lower for the ‘21/’22 crop year by cutting yield estimates. These ratings will be very important moving forward as we close out the month of August and head towards harvest. We’ve said it before and I’ll say it again, there is no margin for error on the production side of the balance sheet this year. U.S. grain stocks are as low as they’ve been in the past five years and there’s plenty of demand for both corn and beans in the months ahead. How will futures markets react? That is the million-dollar question and I’m afraid I don’t have the answer. How will local cash markets react? There’s already plenty of chatter out there of some strange grain movements being merchandised for next year. We expect more weird grain flows in our future as the market functions to meet supply and demand. At this point, all signs lead to another interesting year, to say the least.
Corn is steady to 1 penny lower
Beans are 4-6 cents higher