Good said that unshipped export sales as of Jan. 17 totaled only 236 million bushels, 43 percent less than on the same date last year. There is some potential for the export pace to accelerate, with shipments for the most recent week being the largest since September. The year-to-date deficit and the potential for a large South American harvest, however, suggest that the USDA projection will not be exceeded.
“Taken together, the pace of current and expected corn consumption appears to be rapid enough to provide support for old crop prices for several more weeks but does not suggest the need for much higher prices,” Good said. “Higher prices would require a more rapid export pace and/or additional concerns about the South American crop.”
While old crop corn prices are above the level of Jan. 10, new crop futures are trading at about the same level and harvest cash bids reflect a much weaker basis, according to Good. Those prices are being supported by ongoing concerns about the drought conditions in the western Corn Belt and Plains states, but will have little influence on yield potential or correlation to next summer’s weather.
“If corn yields are low again in 2013, it will be due to poor summer weather, not to current moisture conditions,” Good said. “As a result, new crop corn prices likely reflect too much yield risk.”