Corn prices in March ticked higher thanks to a nice surge in the final trading day of the month. The surprise Prospective Plantings report indicated that U.S. farmers would plant more soybeans than corn for the first time since 1983. But that news capped off an intriguing month of storylines, some of which slipped under the radar for many people in the ag sector.
Before we get to those stories, here’s a breakdown of the action on the contracts that we’re watching this month:
- May 2018: +1.5% or 5.8¢ to $3.878 USD / bushel
- July 2018: +1.7% or 6.8¢ to $3.963 USD / bushel
- Dec 2018: +2.5% or 10.0¢ to $4.115 USD / bushel
And this quarter:
- May 2018: +8.0% or 28.8¢ USD / bushel
- July 2018: +7.9% or 29.0¢ USD / bushel
- Dec 2018: +7.2% or 27.5¢ USD / bushel
In 2018, farmers will plant 88.03 million acres, a figure that was below analysts’ expectations. This figure was 2.14 million acres fewer than farmer plantings last year. This was such a shock to the market that corn prices surged more than double digits on Thursday as traders ignored very bearish corn stocks numbers.
The USDA said that corn stocks as of March 1 sat at 8.89 billion bushels. The nation and the world remain awash in corn. The figure was 185 million bushels higher than trade estimates.
The question heading toward the April WASDE report is whether other countries will pull back on corn production in favor of other crops. Though Argentina’s corn crop has faced significant damage due to weather events across the country, the harvest of Brazil’s second crop is going at a solid pace.
This month, we have talked about declining global corn production, the effects of Trump’s trade policy, and demand for ethanol. Specifically, we have looked at:
- The Prospective Plantings report indicated a downturn in corn acreage,
- Changes in demand for ethanol in China could be bullish for U.S. producers.
- Trump’s trade policy continues to weigh on broader sentiment in the ag sector.
- U.S beef consumption is on the rise. Can it revive corn prices?
Heading into April, there will be a number of key stories that will affect grain prices.
Be sure to sign up for your free 3-week trial at GrainCents as this month could be the most impactful for how and when you price your corn for the rest of 2017/18 old crop supply, as well as a significant portion of your 2018/19 supply.