Overnight markets pulled back after yesterday’s late price surge. Funds were huge buyers of corn, wheat, and beans in the last fifteen minutes of trade. During this time period, corn rallied 10 cents, beans 7 cents, and wheat 13 ¾ cents.
Yesterday’s crop progress and ratings report confirmed an even slower harvest pace than many were anticipating. The corn crop is now 25% harvested. Last year at this time, 53% of harvest was complete and the five year average is 71%. Illinois is 19% harvested compared to an average of 86%. Iowa is 18% harvested compared to 67% on average. Soybeans are 51% harvested compared to the five year average of 87%. This was lower than many traders had expected. Illinois is 35% harvested compared to 92% on average and Iowa is 54% harvested compared to 96% on average. The USDA is recognizing the deterioration of unharvested beans in the Delta as poor to very poor ratings have increased over the past few weeks in Mississippi, Arkansas, and Louisiana. Winter wheat plantings are running behind pace as well, with 79% of the crop in vs. an average of 90%. HRW plantings are running much ahead of SRW plantings.
The next week of weather looks warm and dry for much of the Midwest and should allow some decent harvest progress as areas dry out. However, the 6-10 day forecasts are starting to show increased chances of precipitation around the 10th of November for the western Midwest. With the logistical problems that many areas are having due to wet corn, harvest progress over this time frame may not be as much as would be expected.
Yield reports have started to flow in again as harvest picks up. Overall, yields continue to come in better than expected. Wet corn, damaged corn, and low test weights are causing some problems, but the bushels appear to be out there. Soybean yields should start to flow in more today, and we will have a better handle on what yield was or was not lost on the latest round of wet weather.
The market will continue to monitor the extended forecasts as that is probably the biggest fundamental influence on the market right now. Not only is this going to affect harvest progress, but there is a lot of fall fieldwork that is dependent on dry conditions moving forward as well.
Outside markets will continue to show big influence on the grains. Currently, crude is down 80, gold up $5, dow futures down 50, and the US$ up 37. Look for a lower opening this morning and the market will test to see if buyers will show up to support the market after yesterday’s gains. We expect harvest pressure to weigh on the market over the next week, but rounds of buying like we saw late yesterday will negate all other influences on the market. Opening calls are corn down 3-4, beans down 3-4, and wheat down 5-6. Call if you have any questions. 877-310-5643
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