Markets have rallied over the past several sessions with major gains seen in corn, soybeans and wheat futures.
Todd Hultman Lead Analysis for DTN says we are seeing very tight soybean supplies but there is no sign of export sales activity rationing, as would be expected. “I never thought I would say this but $15 is starting to look conservative on the soybean side” Hutlman says he does not think we would be seeing high corn prices if soybean supplies were not as tight as they are. “Even with USDA’s more bullish estimates that we saw on Tuesday, But at the moment there is no stopping corn with the way soybeans are helping to prop it all up.”
USDA reduced their corn crop estimate by 325 million bushels. Hultman says that most analysis were not expected that large of a decrease “that was also the most they have lowered it from the November to January time frame on record of looking back on the past 38 years.”
Hultman broke down state by state crop estimates and said he was not expecting the largest loss to be in the state of Minnesota. “That is a state that I described as the Garden of Eden throughout most of the year, in fact if you look at the crop progress report Minnesota ended with an 87 good to excellent crop rating”.