Current Market Conditions.
On March 31st the USDA gave us some surprising acreage numbers. They estimate 2022 corn planted acres at 89.5 million vs 93.4 mil last year and 92 mil estimated by trade experts. Soybeans are estimated at 91 million vs 87 last year and 89 mil estimated by trade experts. This has led to a solid 60+ cent rally in December corn and an initial drop in soybeans followed by a nice recovery to only about 50 cents off the November contract high. Then on April 8th we had a monthly WASDE (supply & demand) report, which was focused on grain stocks on hand, which was in line with expectations. We currently sit at a 1.44 billion bushel corn carryout and a 9.6% stocks/use ratio vs last year’s final number of 8.3%. We see almost identical figures as last year on soybeans of a 260 million bushel carryout (257 million last year) with a 5.8% stocks/use ratio (5.7% last year). However, one difference is at this time last year some were predicting a sub 150 mil soybean carryout. It did not come to fruition, but it did create a lot of concern with domestic users.
The market will be primarily trading any headlines surrounding the war in Ukraine, old crop export sales announcements, and U.S. weather in a few weeks. Planting delays are starting to be talked about, but keep in mind how quickly the U.S. farmer is able to plant the majority of their crop. Corn acreage at 89.5 million acres leads to a tight balance sheet and is generally supportive, but be sure to give Premier a call to take advantage of these solid price levels if it makes sense for your operation.
Contact me today if you would like to chat more about the current markets.
Grain Lead & Merchandising