Jul 29, 2014
Sign UpLogin

End Users Skimp as Corn Supply is Divided Up

October 27, 2012
By: Sara Schafer, Farm Journal Media Business and Crops Editor
harvested corn
  

Exports of U .S. corn are falling off a cliff and trade is turning sideways as harvest winds down.

Demand is strong for U.S. corn, but unfortunately the supply is just not there. Additionally, countries like Brazil, Argentina and Ukraine have grain to sell.

This week’s export sales report shows actual sales at 140,300 metric tons. Traders were expecting between 150,000 to 250,000.

Jerry Gulke, president of the Gulke Group, says just a few years ago, export sales were double of this week’s level. He’s not surprised exporters are the end users that are falling off the fastest in the corn-supply and demand table.

"That’s partly what has to happen when you produce 1 billion bushels less. You have to cut demand somewhere."

Gulke believes the U.S. will likely keep cutting exports until the corn supply is replenished. He is also encouraged by the reduction in exports, as he thinks the supply/demand situation for corn may actually be able to reach equilibrium.

"If we’re using market share in exports and aren’t feeding as much here, maybe it will balance out. Maybe we’ll just make it on this short crop."


Trade Turns Sideways

As of Monday, Oct. 22 nearly 90% of the crop has been harvested, according to USDA. Normally, only around half of the corn crop is harvested by this point of the season. Key corn-growing states like Illinois, Iowa and Minnesota have all surpassed 90%.

See this week's market movement analysis: Strong Long-Term Outlook for Prices

As harvest winds down, the grain markets have moved toward a sideways pattern, Gulke says.
See the December 2012 corn chart:

dec corn chart

"Markets are trading sideways because it can’t really break up or down. We just need a catalyst of some sort."

Listen to Gulke's full analysis:

 

For More Information
See the latest market quotes with AgWeb's Market Center


 

See Comments


 
Log In or Sign Up to comment

COMMENTS (5 Comments)

8732
give me a break
10:29 PM Nov 8th
 
8732
give me a break
10:29 PM Nov 8th
 
Steven - Kingsley, IA
fruits and nuts
8:37 PM Oct 27th
 
vivalaevolucion - Oceanside, CA
I believe the US should have more subsides for healthy fruits and veggies, and less subsides for corn and soybeans. The low cost of corn and soybeans, and their byproducts like high fructose corn syrup and soy lecithin, are major contributing factors to our growing obesity problem. Creating more subsidies for healthy fruits and veggies will lower cost on these healthy foods and lower our healthcare cost by reducing the amount of obesity related diseases. Also, I believe we should eat less meat, as our high meat consumption also contributes to high healthcare cost and raising of meat produces a lot of greenhouse gases. Jesus was a vegetarian, expect I believe he ate fish.
5:11 PM Oct 27th
 
vivalaevolucion - Oceanside, CA
I believe the US should have more subsides for healthy fruits and veggies, and less subsides for corn and soybeans. The low cost of corn and soybeans, and their byproducts like high fructose corn syrup and soy lecithin, are major contributing factors to our growing obesity problem. Creating more subsidies for healthy fruits and veggies will lower cost on these healthy foods, as well as lower our healthcare cost by reducing the amount of obesity related diseases. Also, I believe we should eat less meat, as our high meat consumption also contributes to high healthcare cost and raising of meat produces a lot of greenhouse gases. By the way, Jesus was a vegetarian, expect for fish.
5:11 PM Oct 27th
 



Name:

Comments:

Hot Links & Cool Tools

    •  
    •  
    •  
    •  
    •  
    •  

facebook twitter youtube View More>>
 
 
 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions