More corn in the ground than expected has the U.S. Department of Agriculture lowering its price expectations.
The USDA’s World Agricultural Supply and Demand Estimates shows 190 million bushels more corn in the ground than it estimated in June. This came as economists were hoping for a report that would carry the above average prices even higher. Some even thought $5-per-bushel prices were possible under the right conditions.
Instead, the report expected prices to drop by 10 cents at the mid-point to a range of $2.90 to $3.70 per bushel.
University of Illinois Agricultural Economist Todd Hubbs said demand and weather in August will be crucial to farmers’ wallets.
“These next few weeks, as we move into and through pollination in a lot of areas is going to make the difference,” Hubbs said. “We’ll see how that turns out when we see the production report that comes out in August. There are some negatives for corn out there, but we’ve seen some pretty good demand. If we have a big yield hit this year, we could see a good price run in corn.”
He said soybean markets look good at the moment but isn’t as optimistic as others because of the high volume in the fields.
“If we see continued demand from China and other places overseas for our exports, that could be a positive sign, but there are a lot of beans out there,” Hubbs said.
Both corn and soybean bushel-per-acre yield estimates were unchanged.
–Illinois News Network