The harvest weather has not been good in many parts of the Corn Belt so far this fall, but that hasn’t pushed grain prices much higher yet.
“We’re at the point where it’s not in the bin till it’s in the bin,” says Don Roose, president of U.S. Commodities in West Des Moines. “We’ve gone from rain makes grain to just rain makes mud.”
As of last week the corn and bean harvests were both behind normal, but not to any great extreme.
Snow in the northern wheat belt has caught some traders off-guard. Farmers in parts of Montana and North Dakota are now harvesting wheat in the snow, while farmers in the Midwest are trying to get soybeans and corn out of the field in the rain.
But Roose says grain supplies on hand are still large, and a supply market is unlikely to develop unless there are more problems regarding the U.S. harvest. Farmers here really need a crop failure somewhere else in the world, he says.
Traders are still watching the ethanol situation and the trade war with China.
If there is good news in the market it is that there is a carry, Roose says. Farmers who have on-farm storage or access to affordable off-farm storage might be advised to look closely at the idea of storing grain until 2020, Roose says. The basis levels remain tight and there may be marketing possibilities there.
Still, the overall grain outlook is not especially bright, and farmers likely need to be looking to use market tools to reduce risk. And Roose says they need to be hoping for good news from any place they can get it — whether that means a government announcement regarding ethanol or any improvement on the trade front or a crop failure in another part of the world.
“We’re in a demand bear market right now,” Roose says.