In the September USDA crop production report, the government agency forecasted corn yields to be an estimated 169.9 bushels per acre and soybeans to yield 49.9 bushels per acre.
As harvest continues to roll, or for some farmers begin, the phrase “better than expected” has been echoed countless times. On U.S. Farm Report, Tommy Grisafi, branch broker of Advance Trading, Inc., said prices could impact soybeans more than corn as the trade reacts to these reports.
“If bean yields were one or two bushels lower [than final USDA numbers], then you have a market,” he said. “It’s going to take an incredible amount of energy to get corn to stay up at a level the grower’s happy with.”
Grisafi believes this momentum could continue, citing China and recent soybean sales to Mexico as the key drivers.
“It’s a lot easier to put $9 to $10 bushel of something in a boat than it is $2.75 bushels of corn,” he said. “The numbers make more sense to import a bean. Analysts have been wrong for years about big carryout[s]. We’re definitely not running out of anything.”
Futures prices are rallying and Brian Splitt, a broker with Allendale, Inc., says China “can’t afford to not buy U.S. soybeans.”
“They consume so many soybeans that the rest of the world cannot produce enough beans without our production involved,” he said. “Their import program will vary between North and South America.”
To Splitt, here are concerns Brazil’s planting dates will be pushed back, delaying their harvest.
“That may push more export demand into our books,” he said.
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