MarketsFarm — Nearly a week after the U.S. Department of Agriculture’s (USDA) Aug. 12 release of its monthly supply and demand estimates, they still lingered in the minds of traders at the Chicago Board of Trade (CBOT).
“Corn at $5.65 (per bushel), that’s where it’s trading right now, that is the fair market value for corn, given the last carryout we got from the USDA of 1.242 (million bushels),” Ryan Ettner, trader for Allendale Inc. at McHenry, Ill., said at 11 a.m. CT Wednesday (all figures US$).
The Pro Farmer Crop Tour, which began Tuesday and runs until Saturday, is being watched very closely by traders looking for any deviations from USDA’s crop estimates. However, Ettner believes there won’t be too many.
“I don’t think anybody is seeing a large enough difference in numbers to change anyone’s mindsets. It looks like December corn will be gravitating around $5.65 for now until we run into another piece of news or traders start thinking differently.”
While Ettner said average corn yield estimates have historically been low in the August USDA report, he thought the numbers from the report were fair and doesn’t expect too many changes in prices over the next few weeks.
Soybeans have been “overpriced” by 60 to 70 cents, according to Ettner, at $13.565/bu., and were the topic of 10 morning sales reports in a row.
Once that streak ends, he expects prices to drop to $13.
New-crop wheat contracts have also recently reached new highs and Ettner believes the focus should soon shift to the demand side.
“Spring wheat harvest was 58 per cent (last week). We’re still going off combine yield reports, as well,” he said.
“In another week or two, all wheat contracts should shift entirely onto demand and we know our supply is low from the spring wheat crop. We’re likely to maintain strong price levels unless exports start to fall off.”
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.Tagged cbot, Corn, crop tour, estimates, futures, new-crop, soybean, supply and demand, USDA, WASDE, Wheat