News

Lower corn prices might stick around awhile

A grain market analyst isn’t optimistic corn prices will improve much before next spring.

“The numbers are just not there.”

Richard Brock with Brock Associates says USDA’s November Supply and Demand report was a game changer with a 1.9 bushel/acre increase in the national average corn yield.

“What that does is it takes the carryover to 2.2 billion bushels plus and the stocks-to-usage ratio to 15%. The last time we had a balance sheet like that was in the 2018/2019 marketing season and corn averaged $3.61 a bushel that year, $1 lower than where we are now,” he says. “I don’t think that’s going to happen, but what we do think is going to happen is this will result in the cash corn market going flat.”

He says that means more corn is likely to stay in storage. Even though there are weather concerns in South America, Brock says it might take a shift in U.S. planted acreage from corn to soybeans next spring to change the market outlook.

“With ratios right now, we should see a shift, but most farmers are set in their rotations and don’t make dramatic changes.”

He says he’s cautiously optimistic for stronger soybean prices with support expected from domestic crush and the renewable diesel market.