As harvest approaches, and low commodity prices persist, a recent AgWeb survey shows farmers still have an abnormally high percentage of old crop corn and soybeans to sell.
USDA’s June Grain Stocks Report also found on-farm corn stocks were up 36.5% versus the previous season to more than 3 million bushels, which is the highest level since 1988.
Arkansas farmer Becton Bell says he could harvest one of his best crops ever, but marketing the crop will come at a loss.
When asked his biggest challenge this year, he says it’s been the markets.
“There just hasn’t been a good marketing opportunity,” he says. “It’s kind of like catching a falling knife, trying to market soybeans and corn. Nobody wants to catch that falling knife.”
How much old crop do farmers across the U.S. still have left to sell. Based on a recent AgWeb survey, farmers reported the following:
- 83%, or 1,111, still have zero to 25% in storage
- 10%, or 139, still have 26% to 50% in storage
- 4%, or 52, still have 51% to 75% in storage
- 3%, or 36, still have 76% to 100% in storage
As for old crop soybeans:
- 89%, or 1,189, still have zero to 25% in storage
- 7%, or 94, still have 26% to 50% in storage
- 2%, or 28, still have 51% to 75% in storage
- 2%, or 27, still have 76% to 100% in storage
As of late August, farmers are trying to sell their old crop to make room for the new crop they’re gearing up to harvest.
According to the AgWeb survey, 52% of farmers say they don’t plan to sell their old crop corn before harvest, and 60% say they’re holding on to their old crop soybeans.
Reaction and Analysis
The latest survey is proof farmers have moved some of their old crop corn and soybeans ahead of harvest, but market analysts and economists say this is still historically high.
“If the survey had been done a month earlier, the results likely would have been more skewed to the 26% to 50%, rather than zero to 25%. No one can deny the most recent price break to below $4 in corn and $10.50 in soybeans caused a large capitulation by farmers waiting for a rebound in prices,” says Peter Meyer of Muddy Boots Ag. “Whether it was of their own volition, concerns over storage space with harvest approaching or prompting by relevant lenders, the recent sell-off was exacerbated by the number of old crop bushels in storage. Over the past 10 to 12 years, an explosion of sorts in bin space has materialized to take the ‘carry trade’ away from commercial buyers. Unfortunately, that storage asset turned into a liability in 2024.”
“The zero to 25% is a big number, but I do think farmers have cleaned a lot up,” adds Arlan Suderman, chief commodities economist with StoneX Group. “That’s been reflected in the market as we have seen funds unwinding short positions without much of an increase in prices. That’s an indication of the hand-off and exchange we’re seeing of ownership from the farmer to the funds as they unwind their positions.”
The fact that 10% of farmers say they still have 25% to 50% of their old crop corn sitting in the bin is a result of commodity prices taking such a quick turn, says Darren Frye of Water Street Solutions, which left farmers with the difficult decision of selling in a falling market.
“You go back to last June, a year ago June, and that rally happened quickly. The break off, the highs, happened quickly and a lot of people just didn’t get a chance to sell a lot of the old crop, which was new crop then, or the new crop of ’24,” Frye says. “If you take a look at what has happened since then, we’ve never gotten back above the spring based price, and that’s unusual.”
With ideal weather, and the failed forecasts of a hotter- than-normal summer, Frye says the markets continued to see price pressure.
For Meyer, he says holding onto old crop heading into harvest is an emotional decision.
“Certainly, we expect prices to stabilize at current levels but we are hard-pressed to find a catalyst for a substantial price rally, absent of a weather issue in South America come fall. Even then, supply rallies have proven fleeting, a trend we expect to continue,” Meyer explains. “Liquidity will become critical after harvest when lender meetings occur. It may hurt to raise the white flag at this point, but holding onto a non-performing asset will likely lead to a worse outcome.”
