Jerry Gulke says this week’s USDA reports were optimistic for grain and shares what farmers should now be watching.
Overall, Jerry Gulke, president of The Gulke Group, says USDA’s February round of World Agricultural Supply and Demand Estimates (WASDE) and Crop Production reports were positive. "The biggest surprise was they raised exports," he says. "That’s good news because we are selling corn again."
Gulke says USDA increased corn exports for the year by 150 million bushels. "Those traditional buyers for us, who vanished when we had $7 corn, are coming back to buy from us," he says. "USDA raised exports in spite of the fact that China has cancelled some contracts."
Hear Gulke's full audio analysis:
USDA cut its estimate of U.S. corn ending stocks to 1.481 billion bushels, which was well below the average trade estimate. "Corn carryover under 1.5 billion bushels is a long ways from 2 billion bushels some people were talking about," he says.
Overall, Gulke says USDA’s February reports were optimistic. "We’re buying back demand, slowly," he says. "It’s a little like watching paint dry."
With the end of February near, Gulke says farmers will soon find out their insurance coverage levels. "We don’t have a lot of time left to get a good average price for corn," he says. "For us to get 2014 corn 50 cents higher, you have to really rally from here because we started low."
After insurance prices are set, he says, all eyes will be on the March 31 reports, which will include Grain Stocks and Prospective Plantings reports.
Have a question for Jerry? Contact him at 815-721-4705 or email@example.com.
Complete Coverage of Feb. 10 USDA Reports