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Economist says supply & demand reports quickly affected markets

An economist says there might be some opportunity in the market following the USDA supply and demand reports released Thursday. 

Brenda Boetel with the University of Wisconsin River Falls tells Brownfield the reports delivered a few surprises like increased carryovers and an even larger production estimate from Brazil, but with tighter than expected supplies, the market reacted quickly. “About an hour afterward, we saw thirteen cents in corn and about twenty-seven cents increase in soybeans.”

But, Boetel does not expect corn prices to keep climbing long-term. “Essentially, the market is having this boost because of the reduction in supply that the USDA came out with, but once it digests that and realizes that demand hasn’t improved some, we’ll see those prices go down a little bit.”

Boetel is expecting soybean prices to increase for now. “Given the strength that we’re seeing for crush, even though it’s tapered a little bit, it’s still very strong year-over-year. We should still see those soybean prices improve here, at least in the next couple of days.”

And for corn, Boetel says U.S. prices are higher than the world market and could drop to as low as $5.05 a bushel later this year.

Boetel spoke to Brownfield at the Wisconsin Agri-Business Classic in Madison. Wisconsin Thursday.