Yield is the big question mark in Tuesday’s WASDE
A market analyst says he’s closely watching yield estimates in next Tuesday’s supply and demand report from the USDA.
Jim McCormick with AgMarket.Net tells Brownfield corn yields could drop about 2 bushels per acre and soybeans almost a bushel per acre. “We’ve obviously gone since the August WASDE number when they collected that data at the very end of July. The first few days of August, we’ve seen a huge change in the weather patterns, some of the warmest, driest temperatures we’ve ever seen for this time of year. So, the trade is looking for the crop to get a little bit smaller.”
He says trade estimates are around 173.5 bushels per acre for corn compared to 175.1 in August from USDA. Soybeans were estimated at 50.9 bushels per care in August and the trade is estimating 50.1 bushels per acre.
He says the report will likely indicate a smaller crop. “They tend to cut exports, maybe cut crush a little bit. We don’t think they will lower ethanol demand, but in general what we anticipate is the corn to supply to get cut a little bit, the corn demand to be cut a little bit.”
McCormick says a downward adjustment to yields could push soybean prices higher, but not for corn. “Unless excluding just a major surprise in some other commodity like a really bullish reaction to beans. I unfortunately think you’re going to see a huge reaction in the corn market because the reality is that 2,150,000,000, that’s the number we’re all looking at that’s not tight unfortunately.
He says the market should respond to yield data from harvests and not Tuesday’s report.