Weekly Market Recap February 21, 2020

Soybean

Please note: we are now following the MAY futures for cash corn and soybean prices. 

May Corn Futures are down 1 1/4 since the close last Friday. The highest price we saw on the week was $387 1/2 and the low was just below the closing price of $3.80 3/4. It has been unable to escape the same 10 cent range for the last 18 trading sessions. 

May soybean futures prices eroded more than 4 cents since last Friday, finishing below $9.00 for the first time in over a week, ending at $8.99. This week’s NOPA report showed another strong month of crush, and at a record level for the month of January. 

Most of the focus this week was on the USDA Outlook Forum, which more or less confirmed the fears that next year’s crop could be massive. Currently, the estimates are 94 million planted acres of corn. Again, these are just estimates and not confirmed intentions, but the fear of lower prices remains. For corn, the carryout looks to be considerably higher than last year at 2.6 Billion bushels, up from the estimate of 1.892 this year. This would result in a $3.60 average cash price vs. the estimated $3.85 this year. Bulls have a little to chew on with the strong export report this week as well as a very tight basis.

With regards to the Outlook results, beans actually look much better through this extended scope. Although an increase in planted acres is expected, total usage should increase and the forecasted cash price received is a little higher than last year at $8.80 vs. the $8.75 received this year. They pegged ending stocks for 2020/21 at 320 million vs. the current year of 425 million. 

Other bearish news affecting both commodities: the dollar has remains strong, South American harvest is ready to start moving even more and coronavirus concerns still linger. 

If you are tired of getting down about these markets, the averaging contract has performed very well recently and is a good way to jump-start your marketing for New Crop bushels. The deadline for sign up is next Friday. 

Listen to this week's podcast: https://landuscooperativeexperience.podbean.com/

Have a good weekend.