Early April rains and a string of warm weather has planting season firmly in the minds for many Midwest farmers. As they look at markets for the upcoming crop, acreage expectations are likely to limit corn’s price movement, but soybeans may find room to be bullish.
“With corn, it’s hard to get pulled up because the intended acreage was higher,” said Jack Scoville of Price Futures Group. “I expect we’ll see some fading in the new crop. In the beans, the expectations are much more tempered because the acreage is unchanged from last year. If there is a potential for a rally, it would probably be in the new crop soybeans rather than the new crop corn.”
Markets have been on an uptrend in recent weeks, which matches the seasonal trend, but Scoville said not to be surprised if there is some selling as prices reach their peak. Weather will also be a significant factor in the coming weeks as rains have helped ease drought in the western Corn Belt, but additional rains could potentially push planting dates back for many farmers.
“If it keeps raining, it will become an issue again,” he said. “It looks like we are going to be warm and dry for a while and that’s going to help dry things out. But it has to stay that way and if weather comes back, delays will become important (to price movement).”
There also remains the concern of flooding along the major rivers as the northern snow pack melts and could make the Missouri and Mississippi rivers rise quickly.
Internationally, corn markets have seen a boost from sales to China in recent weeks, something Scoville said should be sustainable.
The impact of South America’s crop is starting to fade as the U.S. planting season nears, he said.
“It’s gotten late in the season so the weather threat is coming to a close down there,” he said. “Half of Brazil is harvested already and Argentina will get underway in the next couple of weeks.”