There was no bullish news last week. Without a large-scale weather issue, Chinese analysts are expecting a 7% increase in corn production next year, which would lower demand overseas for our product. In the U.S. weather so far has been the right mix of rain and sunshine, which will provide a good start to the growing season.
Low prices on the CBOT allow the U.S. to be more competitive in world markets, which may generate a buying opportunity and allow prices to increase a bit in the short term. However long term, if weather conditions stay favorable, it will be difficult for new crop corn to stay above $3.50. It may even mean, similar to 2014, falling prices into harvest. A bumper crop followed by a bumper crop is extremely bearish for futures prices.
Beans can’t seem to pick a direction. There were some new crop cancellations this week, however soy meal demand remains strong domestically.