While the November production forecasts will provide a clearer picture of the availability of corn and soybeans, Good said that prices will now take direction primarily from the ongoing rate of consumption.
“Those patterns were detailed in last week’s newsletter,” Good said. “The strong pace of soybean exports and export sales continue, and the corn export program remains weak. For corn, however, considerable uncertainty about the pace of feed and residual use will persist until the Dec. 1 stocks estimate is available in the second week of January. It seems unlikely that the pace of feeding has yet been reduced to the level forecast by the USDA. Consumption in that category is forecast at only 4.15 billion bushels, 412 million below the official estimate for the past year.
“However, last year’s consumption is likely understated due to the availability of larger-than-normal quantities of new-crop corn,” Good said. “Similarly, part of the consumption that will be reported during the current year may have been used last year. Prices of both commodities should be well supported until rationing has been confirmed.”