Corn, Soybean Prices Continue to Struggle

Although futures prices for corn remain in a relatively narrow range, basis levels generally remain quite strong and at record levels for this time of year in some markets, he says.

“Spreads in futures remain very choppy, with the December-July spread fluctuating between 18 and 23 cents,” he says.

The apparent battle between current demand strength and expected weakness in 2012 continues, he says.

“In contrast, soybean basis remains near typical levels and spreads are generally large. The January-July spread, for example, is near 30 cents, compared to only about 5 cents in early September. The weak basis and the relatively large carry reflect the generally weak demand situation,” he says.

For now, January soybean futures are holding just above the early October lows while December corn futures are well above the early October lows, but near the low end of the recent trading range. 

“The recent sideways trading pattern might persist for an extended period, but the deterioration of market fundamentals suggests that prices could drift lower into the winter months,” he says.