The harvest-low price for corn is likely to occur in October, assuming weather conditions support a favorable end to the growing season, says Pete Meyer, PIRA Energy Group.
It’s unlikely we’ve already seen the low price, he cautions.
“I think there’s going to be some pressure from bankers,” Meyer tells Tyne Morgan on the “AgDay” Agribusiness Update segment for Tuesday, Aug. 30, 2016. “I think the farm economy is one thing that really worries me, and I wonder who’s controlling these bushels. Will the banks allow some of these farmers that are struggling a little bit at the moment, unfortunately, to carry these bushels forward? I don’t know who’s making up the rules. I think that it really depends on how the weather proceeds from here on out.”
Commodity prices didn’t move much in response to the Pro Farmer Midwest Crop Tour findings showing lower projected corn yields, and slightly higher soybean yields, than USDA announced in August. That doesn’t mean the trade has turned a blind eye to the market, Meyer says.
“I think the trade is watching demand in soybeans, and I think the trade is just kind of whipsawed from that move up to $4.49 [corn] and back down,” Meyer explains. “The trade is just kind of minding their Ps and Qs. We did see some capitulation—what seemed like capitulation—by some farmers even during Crop Tour … They’re clearing their bins, they’re moving it out. Is there an underpinning demand for this? Yeah, I think there is an underpinning demand, it’s just a matter of when the flood hits the market, and by that I mean a flood of corn.”
Watch the complete “AgDay” interview with Meyer below.