Even though they may not have all of the answers, analysts at this week’s All Day Ag Outlook Meeting hosted by Illinois Public Media provided some insight for farmers to consider.
Curt Kimmel of Bates Commodities told the crowd the key is surviving another year and the weather is a critical factor for the markets.
“It’s going to be weather, weather, weather,” Kimmel said. “It’s going to put us in a situation where we need to be flexible with what we do.”
Wayne Nelson of L&M Commodities said soybeans were $1.25 higher because of the La Nina weather pattern, giving growers a chance to price crops. According to Nelson, a corn rally typically comes in the April-June time frame.
“We are the place that has the cheapest corn in the world right now,” Nelson noted.
Corn prices could really benefit if U.S. soybean acres increase and corn acres drop, although Dan Zwicker from Zwicker Consulting is not convinced that we are going to lose a significant amount of acres. Zwicker sees slim odds of having a high in the market during the first few months of the year.
Ellen Dearden with AgReview acknowledged that farmers are talking about beans more than ever before with more acreage expected and a bull move for soybean meal.
“I think it still has some legs, but I don’t believe it will have legs into the summer,” she said.
“The processing plants can’t get enough soybeans to crush at capacity,” added Bill Mayer with Strategic Farm Marketing.
Pete Manhart with Bates Commodities feels both old and new crop soybeans should be sold and protected. He recommends selling cash and protecting what is not being sold with puts.
The cash grain panel discussion included Aaron Curtis of MIDCO, Todd Hubbs from the University of Illinois, Brian Stark with The Andersons and Chuck Shelby of Risk Management Commodities. Hubbs explained the weather issues in Argentina and lagging U.S. exports.
“I think that’s going to continue. I don’t think USDA will adjust the number,” Hubbs explained.
The date to watch is March 29 when the Prospective Plantings report comes out. Hubbs predicts more soybeans planted in most of the Midwest and he remains optimistic on corn.
“We’ve had excellent ethanol grind. I feel like that could strengthen.”
Curtis noted the cash side is moving toward a supply and demand situation.
“The farmer has been a very active seller of soybeans,” Curtis stated.
Curtis believes basis is going to stay somewhat weak. He expects better U.S. demand in the next few weeks and advises making sales as this market continues to rally.
Tuesday’s All Day Ag Outlook Meeting was held at the Beef House in Covington, Indiana.