What is in this article?:
- Corn, Soybean, Wheat Markets Reflect New, Missing Information
- Upcoming reports will provide more information
“The markets are supplied with a steady flow of data on consumption in some markets, particularly the export markets and the ethanol market. Less frequent information is available about consumption in other markets, particularly the domestic feed market,” says Good.
For corn, the available data point to a continuation of a high rate of domestic consumption and a slow pace of export shipments, he says.
For soybeans, weekly export inspections have dropped below the level needed to reach the USDA projection of 1.55 billion bushels for the year ending on Aug. 31. Inspections for the four weeks ended May 26 averaged 8 million bushels/week, compared to the 11.5 million average needed to reach the USDA projection, he says.
“The domestic soybean crush pace continues to be slow with the reported April crush at the lowest level for the month since 2004,” he notes.
For wheat, exports appear to be on pace to reach the USDA’s projection of 1.275 billion bushels for the marketing year that ends today. Beyond the consumption data, longer-term demand prospects continue to be influenced by varying indicators and opinions about prospects for economic recovery, he says.
“On the supply side, there is a constant flow of information about planting progress, world weather conditions and crop conditions. That information does not always paint a consistent picture, and the implications are subject to interpretation by market participants,” Good says.
Outside the U.S., there are ongoing concerns about the impact of dry weather on western European grain and oilseed crops and concerns about planting delays for Canadian grain and oilseed crops. In contrast, prospects are generally more favorable in China, India and the Black Sea region, he notes.
“The focus on the supply side right now, however, is primarily on conditions in the U.S. Those conditions are highly variable and are highlighted by planting delays in the northern Plains, the upper Midwest and the eastern Corn Belt,” he says.
In contrast, planting has been timelier in large parts of the western Corn Belt. Dry conditions in the southern Plains have posed an ongoing threat to the winter wheat crop, while flooding has resulted in the loss of some cropland along the southern Mississippi River, he says.
The USDA will continue to provide weekly data relative to planting progress, crop development progress and crop conditions. Information relative to total planted acreage and acreage planted to individual crops is the scarcest, Good adds.
“Considerable uncertainty about the magnitude of acreage of spring-planted crops will persist for at least another month. Uncertainty about total planted acreage is magnified by the difficulty in estimating the amount of acreage that has been lost for the year due to flooding,” he says.
In addition, it is difficult to evaluate how many acres, particularly of corn, will be lost to the prevented planting provisions of the crop insurance program. Several million acres were likely still not planted as of May 29, he notes.
“In addition to uncertainty about total planted acreage, the mix of crop acreage is also difficult to anticipate, with some intended corn acreage likely shifting to soybeans after the first week of June,” Good says.