As the two leaders of the ProFarmer Crop Tour converge, their takeaways from the eastern route and western route tell two very different stories—leaving Chip Flory and Brian Grete watching the markets with new perspective on crop conditions.
“In Iowa, there’s more uncertainty now than there was going into Crop Tour,” Grete says. “I think that it is critical when you’re talking about the No. 1 corn producing state and the number two soybean producing state.”
Flory adds the Iowa corn crop was a big question mark before Crop Tour, and now with those in-field observations it appears to be going backward in many areas of the state.
“If we can get to an average crop in Iowa and make it similar to what it was a year ago, I don’t think it changes the outlook on corn all the much,” Flory says. “We’re still going to be looking at a stocks-to-use ratio in that 14% to 15%, and I don’t see anything too bullish about a 14% to 15% stocks to use ratio.”
However, Ohio’s corn crop was the stand out result for Grete as his team covered the eastern leg.
“Ohio’s corn was impressive; it was more impressive than Indiana. We moved into Illinois and it was way more mature than we saw in those first two states, and then Iowa was just an absolute slam the door in your face type deal.”
Conditions observed on Crop Tour have the leaders thinking differently about soybeans.
“Now, if soybeans finish as poorly as I think they might, and we start taking off some bushels of Iowa, Nebraska and Minnesota, you start to take away from the national average yield,” Flory says. “And then the market is going to be much more sensitive to change on the supply side (of soybeans) than corn.”
Those soybean yield estimates have the team at ProFarmer monitoring soybean stocks even more closely.
“Corn had cushion coming in to the growing season, and the acreage gave us more,” Grete says. “Soybean acres were down, and now we have question marks, and no cushion. There may be some changes on the balance sheet that come about.”
What he says and how he’s watching the markets has Flory saying the 2023 Crop Tour will be remembered as a soybean year.
“Normally, when I’m out on crop tour, I’m thinking about the corn crop and soybeans being a secondary thought,” Flory says. “I’m gonna remember the 2023 tour because of how vulnerable this bean crop was at the end of the trip,”
Both say they think markets will present opportunities with rallies but are cautioning farmers to not get too bullish.
“If we see it, it’s because of demand,” Flory says. “If all of a sudden we see concern over the supply of corn and soybeans in the United States to the rest of the world, and if the importers step in and start buying up in a much bigger way than what they’ve been doing for that 23/24 marketing year, then you’ve got demand coming up and you’ve got supply coming down at the same time. Then maybe we can start to get a little excited about corn.”
Flory notes he’s been saying repeatedly this past week that he thinks a corn/soybean ratio is going to 3:1 and could trade there for a long time.
Grete is layering on global production and grain stocks to his takeaways.
“Brazil’s grown a record soybean crop as well as a record corn crop. Brazil’s still got soybeans left to ship. And Brazil’s got a whole heck of a lot of corn left to ship,” Grete says. “That’s going to impede on the first half of our new crop marketing year, which is one which should be strongest especially for soybeans.”
