Tucker Talk: November 6

Fall Sun

Corn

Corn harvest finally built up steam at Farmer’s Coop Elevator with Tuesday seeing the highest grain intake before rain on Wednesday put a halt to it.  Late planting this year combined with a late killing frost has resulted in corn taking a few more weeks to dry down than normal and harvest is only about 20% complete in Box Butte and Sheridan counties.  Average moisture of delivered corn company-wide is 16% and test weight is 57.5 lbs/bushel.  Reports are still coming in that moisture is still around 18% in some fields.  Luckily we have had a mild fall to help dry the corn before harvest.

In the United States, corn harvest was 85% complete on Sunday.  Trade is surprised at how much corn is being tucked away and stored saying that the amount of on-farm storage across the country has been underestimated.  They are concerned that the quality of stored corn will be an issue because some facilities being used are not meant for grain storage.

Global supply and demand is being heavily debated as corn harvest comes to an end in the United States.  The US is seeing better than expected yields in many areas raising the production estimates of many analysts.  Brazil is also exporting more corn than was predicted.  US exports are in danger from the cheaper Brazilian corn and the fact that there is news looming overhead that China may reduce grain imports in order to boost the use of domestic stocks.  Exports will be the big talk in the USDA Supply and Demand report released next Monday.

Bar graph of major competitors for corn exports.

Bar graph of major competitors for corn exports.

Blue line is USDA estimate.  Light blue columns are last year's exports.  Dark blue columns are this years exports.

Blue line is USDA estimate. Light blue columns are last year’s exports. Dark blue columns are this years exports.

There is talk that the US could see an increase in soybean production next year due to more favorable economics than corn.  The concern, of course, is that supply will outweigh demand if this happens which will have a negative impact on prices.  Soybean exports from the US have  increased over the last several years but there is a slow start this year.

Wheat

Weather concerns were eased over the last week halting the slight rally that we were seeing.  The wheat market this time of year is mostly a speculative stew being fueled by weather and its impacts on dormancy status.  This can be beneficial in that producers can take advantage of any slight rallies to sell their crops out of storage.  I will be developing and promoting wheat marketing ideas as we get closer to the end of corn harvest.  Strategies include setting a floor, stopping storage, and tying 2016 crop to the sale of 2015 crop in order to get a premium on 2015 cash price.

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