Corn: We have seen corn prices appreciate in the last three weeks even though it’s been pretty evident for some time that the crop is huge, and this was confirmed by the USDA on September the 12th. 15.186 billion bushels is nothing to sneeze at especially coming a year after another 15 billion plus crop of US corn. There should be no surprises because prices are so much less than a year ago.There is a large carry in the market this year. In other words, futures months out into 2025 are much higher than December of 2024. Producers will have to determine their cost of storage if they want to take advantage of that carry. Nobody knows when the bin doors will be slammed shut this year, but it could happen especially after January 1st sparking a post-harvest rally. The December 2024 corn contract is currently priced at 17.75 cents below the March 2025 contract which is a bearish indication of new crop corn demand. Seasonally, we know that corn prices tend to peak in early June and bottom out in early October. The December 2024 futures contract is at the 21st percentile of the past five-year price distribution range.
Soybeans: When you think soybeans, you often think about Chinese demand which has historically been insatiable. However, over the past few years it is become increasingly evident that they prefer Brazilian soybeans to American soybeans because it comes with less strings attached. That is certainly playing out as the Chinese are buying American soybeans but more in a piece meal fashion. They’re getting their minimum needs met with the focus to go back to Brazil as soon as they can. Having the November futures contract above $10 is certainly causing some joy in the market. However, keep in mind that much of that has to do with the dryness in Brazil which will begin planting in earnest in October. We all know as farmers that the drought ends when it rains and of course with regard to market action usually that coincides with the market slide. There are lots of soybeans in the world and keep in mind that’s still a major reason why soybean prices are at these relatively low levels. The November 2024 soybean contract is currently priced 32.75 cents below the March 2025 contract which is considered a bearish for new crop beans. Seasonally, soybean prices tend to peak in early July and bottom out in early October. The November 2024 soybean contract is currently at the 23rd percentile of the past five-year price distribution range.
Wheat: In the last three weeks wheat has rallied about $0.60 off its lows in late August which is so uncharacteristic of this market. It is a very good thing and probably reflects some uneven growing conditions in the United States as well as Russia and Ukraine. There has also been dryness in Argentina affecting the wheat crop. On September 13th. The Chicago wheat futures price actually rose to its highest level since early July and closed higher for the fifth time in the past six trading days on September 13th. However, this wheat price buoyancy so far not resulted in the price going over the last 100 day moving average. Late September represents one of the most opportune times to plant wheat in Ontario as early planting is always good for yield the following year. The jump in wheat prices as of September 13th would give us a price of approximately $7.27 a bushel for wheat sold off the combine in July of 2025. How enticing will this be for Ontario producers poised to plant wheat? As always, the fall weather will be a huge determinant in how much wheat gets planted this year in Ontario.
