A lack of big news items in the grain markets is limiting the price movement these days. That is nothing new. We normally do little between Thanksgiving and Christmas, and it looks like that is what we can expect again.
The result of these dull markets is obvious. March corn futures gained just a penny last week. Following that, we saw a range of 131⁄2 cents Nov. 28, but at the close we were unchanged. The morning of Nov. 29, as this was being written, we saw a range of nearly seven cents, but we were actually down one and a half cents.
The soybeans, on the other hand, gained eight cents last week. That just left us in the middle of the week’s range, but we gained 21 cents on a range of nearly 42 cents Nov. 28. That got us to a close of $14.571⁄4 for March futures. For perspective, the recent high was $15.121⁄4 Sept. 13.
Corn
The biggest news in the corn markets is the basis levels being advertised, especially in the west. There are large areas of corn that had yields limited by drought. The result is a demand push, as ethanol and feed plants compete to get the bushels back out of the bins.
For a similar reason, eastern Ohio markets are seeing a pull into the ethanol plant in Clearfield and the feed mills farther east. I have had farmers tell me of basis plus $1 at the feed mills. I suspect that is a long way from a published basis, but it is possible.
The culprit there is a poor crop in Central Pennsylvania. They are always corn deficit, and this year they were hurt by drought.
Soybeans
The soybean news available centers on the weather in Brazil and the demand by China. Brazil has been dry, but they have a good forecast for the next week. That is raising the crop production estimate, and increasing our competition.
The China demand is the unknown. It is recognized that the Chinese prefer to buy beans from South America when they are available. Currently, the Chinese are forcing draconian lockdowns to limit the spread of COVID. It remains to be seen if this limits the demand for soybeans. The prevalent idea is that they will continue to make sure they get the people fed, or they risk demonstrations even worse than the current ones.
Wheat
That gets us to wheat, where we posted the lowest settlement price Nov. 28 since before the Ukraine war, at $7.731⁄4. Last week, we lost a net 27 cents. The morning of Nov. 29, we bounced to $7.803⁄4. It is a big deal that we broke below $8.
This is happening while ships are lining up to take grain out of Ukrainian ports. I guessed wrong on this one. I thought the premium insurance and freight and labor would limit the movement of grain, but there is a supply of brave people to commit ships, I guess.
The brave people in the ag business are the ones who are committing to new marketing ventures. You have to admire the entrepreneurs who dream up new ideas.
We have gotten used to some of the ideas. Dairies skim the fat off milk, sell it for a premium as low-fat, then use the fat to make ice cream and charge a premium for both the milk and the ice cream.
In my own Jack Sprat case, I buy “no pulp” orange juice for my squeeze, and “high pulp” for myself. They skim off the pulp from Ellen’s juice, add it to mine and charge a premium for both.
Locally, we have Denmandale, a large dairy in Trumbull County, bottling some of their own milk for local markets. This is a growing business, since they have friends who are selling all the milk from several hundred cows through their own bottling plant.
More common is a return to specialty and subsistence farms. The pages of Farm and Dairy regularly feature such farms. Agriculture is not just about big commercial farms. Often it is about a vision of the landless to create a farm business.
