After this week’s private crop reports, the odds seem likely USDA will increase the size of this year’s crop.
If you still have a lot of un-priced grain, market expert Jerry Gulke believes you are swimming in risky waters.
This week two key private firms released crop production estimates. Both groups increased the size of the 2012 crop.
Informa Economics estimates the corn crop at 10.738 billion bushels with a yield of 122.4 bu. per acre. For soybeans, the estimates are at 2.925 billion bushels, with a yield of 38.6 bu. per acre.
FCStone is expecting U.S. corn production to reach 10.881 billion bushels, with an average corn yield estimate of 124.0. In soybeans, the firm pegs soybean production at 2.959 billion bushels, with a yield estimate of 39.1 bu. per acre.
In October, USDA projected the corn crop at 10.706 billion bushels with a yield of 122 bu. per acre. The current soybean crop estimates are at 2.860 billion bushels with a yield of 37.8 bu. per acre.
"FCStone was a little more bearish than Informa," says Gulke, president of the Gulke Group.
On Friday, Nov. 9, USDA will release its November Crop Production and World Agricultural Supply and Demand Estimates. What if USDA comes out and agrees with Informa and FCStone?
"It wasn’t that long ago in September that we were talking 35.3 bu. per acre for soybeans. We have jumped that up quite a bit," Gulke says. He expects USDA to increase the soybean yield estimate.
If the U.S. corn and soybean crops do get larger, the recent high prices aren’t likely to stick around. Gulke says producers need to be ready for USDA to throw a few curveballs next week.
Slap on a Price Tag
With corn prices hovering more than $7.30 and soybean prices exceeding $15.20, Gulke says he has a real hard time holding on to grain. He says unsold bushels equal risk.