Mike Minor with Professional Ag Marketing says he's been impressed with how well the corn market has digested Tuesday's bearish yield and production news.
Why is Corn Holding Up So Well?
Corn was steady on the December and slightly higher in other contracts but Mike Minor with Professional Ag Marketing says he's been impressed with how well the corn market has digested Tuesday's bearish yield and production news.
Corn has been up two of the last three days post WASDE and by all accounts should be seeing more pressure with a record 16.7 billion bushel crop and 188.8 bushel yield.
He thinks the market was so bearish heading into the report some of the negativity was dialed in but he thinks it will also be difficult for the market to build on it and he's not ready to call a low either.
"From a seasonal perspective the last five to ten years it's been very normal for us to put a low in at the end of August. You go further back than that.
Typically a big crop would get bigger and you'd put a low in in September or October back in the good old days. So last year it was August 26th around that three mid -380s level on December corn futures, we've tested around that area. Some people have been calling that the low is probably in. I would argue that it's going to be difficult for the USDA to get a bigger yield going forward. So from that perspective, I think the balance sheet could potentially improve from here. So fundamentally, sure we could probably put our low in here somewhat soon on this corn market," he explains.
Did Pro Ag Find a 188.8 Corn Yield on Their Tour?
Minor wrapped up the annual crop tour for Professional Ag Marketing this week covering several Corn Belt states.
He says the corn crop looked exceptional in the Western Corn Belt but he did find some far from perfect fields in the East.
In fact, with the pollination and disease issues in Illinois and other states he thinks getting to a 188.8 yield will be difficult.
"Illinois, Indiana, and Ohio out there in the Eastern Corn Belt. I think my samples came in, 80 % of the samples came in lower than last year on that crop tour from the same and the areas and farmers. So in my perspective, going out and pulling the samples in the Eastern Corn Belt, I was disappointed to try to get them up to something like, you know, a 220 -plus type yield out of Illinois. I was at more of a 207. So I think that the Eastern Corn Belt, those three states, you pair those back a little bit, you can easily pull that yield back to a 186 -185." he describes.
