Pristine Planting Conditions Could Pressure Prices

February 29, 2016 12:00 PM
 
Pristine Planting Conditions Could Pressure Prices

Weather forecasts suggest optimal planting conditions could be ahead for many U.S. corn and soybean regions, putting pressure on prices, says Brian Roach, Roach Ag Marketing.

“Last year, we had a catalyst that came with a wet spring and acres not going in the ground, and we put 90 cents in the corn market in a short period of time because the specs had set it up that way,” Roach tells “AgDay” host Clinton Griffiths on the Agribusiness Update.

“I think we could just plan on the specs being in that short position in corn and soybeans," Roach continues. "We could be record short in May just like last year if the crop and the forecast were to play out like they look, which looks to me like the next 60 to 90 days could be dry and warm. That means our crop goes in the ground. I think you could probably plan on prices being under some pressure.”

It’s too early to get excited about USDA’s outlook numbers published this past week, he adds. Instead, it’s valuable to look at indicators that might make 2016 different from other planting seasons.

“Beginning supplies are larger than normal, so we don’t start off with a tight pipeline like we’ve had a couple years ago and back,” Roach says. “I think as you look at a roll forward based on trendline yields, we see corn acres coming up [with] better potential for corn profits with fertilizer prices down versus soybeans. The surprise might have been we’re seeing fewer wheat acres. Those acres might actually move over into soybeans.”

Click the play button below to watch the complete interview with Roach on “AgDay.”

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Comments

 
Spell Check

richard
CITRUS HEIGHTS, CA
2/29/2016 07:01 PM
 

  Has anybody heard of summer fallow-or do they want to oversupply the market-like the oil market and bankrupt themselves?

 
 
Mike
Minatare, NE
2/29/2016 05:27 PM
 

  Just print more doom and gloom as you can't even predict the weather 24 hours out and yet we are going to have great planting weather! We were predicted to have a high of 61 today with 50 mph gusts, it's 42 and the group is white with snow! Get my drift?

 
 
Old S.W. MN. Farmer
Worthington, MN
3/1/2016 10:53 AM
 

  Yes Rich(Ca.) most farmers have heard of summer fallow,its practiced in areas where they can't grow crops back to back usually for lack of moisture,then they discovered min-till/no till to conserve moisture and now many of those areas raise a crop each yr. I find myself repeating the same old same old thing, the only way cutting production will ever work is on a GLOBAL basis not just here in the U.S.A.,when we cut production here it only encourages more land being put into production in other parts of the world, like Brazil who is now harvesting 50 b.p. a. soy,remember this is their secondary crop not their primary.As I've referenced before, farming is akin to sows at the feed trough,the biggest,toughest, most cunning one gets the largest portion. The time is on the horizon when there will be few enough active farmers that they will be able to organize and demand a profit on what they produce,the writing is on the wall for those willing to read it!!!

 
 

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