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Corn Market Outlook for 2018/19
Corn Market Outlook for 2018/19
creates big swings in the price outlook. This is why weather is going to be the main focus for traders in the next couple of months. Planting progress for corn is currently behind at 59 percent compared to a five-year average of 63 percent. If the Midwest is able to get some windows of dry weather, they shouldn’t have an issue catching up and getting the crop planted. Rain this time of year is always a catch-22. It delays planting progress, but it also helps soil conditions and could set the stage for stronger yields. Overall, this is a market where the current corn price seems fundamentally accurate given the information above. The question this time of year is how accurate do we feel the USDA estimates are going to be? Nobody has a crystal ball, so having a good risk-management strategy in place is essential. There is a risk of loss in futures and options trading. Past performance is not necessarily indicative of future results.
May’s USDA World Agricultural Supply and Demand Report (WASDE) was the first time the USDA put out an estimated balance sheet for the 2018/19 crop. U.S. corn carryover is estimated to be at 1.68 billion bushels for the 2018/19 marketing year. To put this in perspective, our 2017/18 carryover was 2.18 billion bushels. World corn ending stocks were estimated at 159.15 million metric tons for 2018/19. The 2017/18 ending stocks were at 194.85 million metric tons. The lower estimated outlook for ending stocks worldwide is largely due to lower U.S. production as well as a reduction in Brazil and Argentina’s production. The ending stock numbers are favorable for farmers and are the reason we have already seen the price increases in the market so far this year. The USDA is estimating the corn yield to be at 174 bushels per acre. This is down from last year’s 176.6 bushels per acre. Keep in mind that nobody really knows what that final yield number will be. A small increase or decrease in the yield can have a big impact on the balance sheet and, in turn,
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Caldwell Store 208-459-0806 101 Rodeo Ave. Caldwell, ID 83605 Burley Store 208-878-7224 1001 W. Main St. Burley, ID 83318
Jerome Store 208-733-6145 1100 W. Main St. Jerome, ID 83338 Sunnyside Store 509-836-0267 304 Yakima Valley Highway Sunnyside, WA 98944
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