Farmers responded to the nearly 6% rise in soybean prices since the U.S. Department of Agriculture issued its Jan. 12 crop report by selling large amounts of their old-crop soybeans, grain dealers said this week.
Grain dealers bought on Monday’s holiday and again on Tuesday when the Chicago, Ill., market sped to a six-month high. While there were some new-crop sales, most of the business has been old-crop. The slow new-crop business was attributed to farmers having “seen these prices before” and being willing to wait for higher prices, an Iowa dealer explained.
There were sales of old-crop and new-crop corn as well, but the volumes lagged those of soybeans. Old-crop cash prices of $3.47/bu. late last week and about $3.53 on Tuesday were not enough to entice farmer selling, a dealer in central Illinois said.
Later in January, some Iowa grain elevators will offer free storage of corn. The elevators will own the grain, but farmers will have until late August to set a sale price. The offer is intended to draw corn from farms so elevators can quickly sell it to end users. The free storage is primarily offered on corn because farmers tend to store it after harvest while selling their soybeans off the combines.
Ice storm issues
The weekend ice storm throughout the Midwest made traveling hazardous on both rural roads and on elevator tarmacs, while the main roads were clear of ice, Midwest grain dealers said.
No power outages were reported, as a lack of wind prevented breakage of ice-coated power lines.
Warmer weather is in the forecast this week and next week, which should prevent additional ice issues.
A corn train was being loaded in central Illinois on Tuesday for shipment to a food processor in the Southeast. Concerns about vomitoxin in parts of the eastern Midwest have had processors shopping for supplies in Iowa and Illinois, a few dealers said.
Soybeans are going to local processors as bids in the export market have eased.
Currently, soybeans for January delivery to the Gulf are bid about 32 over the Chicago Board of Trade (CBOT) March contract, down about a dime from a week ago. Some of that drop can be attributed to the higher futures. February is bid about 33 over the CBOT March.
Barge grain shipments during the week ended Jan. 7 totaled 662,774 tons, down 14% from the prior week and up 53 from a year ago, according to USDA’s "Grain Transportation Report."
In the rail sector, grain car loadings totaled 19,646 during the holiday-shortened week ended Dec. 31, down 13% from the prior week and up 6% from a year ago, the report said.
For truckers, the U.S. average diesel fuel price during the week ended Jan. 9 was up 1 cent to $2.60/gal. That is up 42 cents from a year ago.
USDA’s latest weekly grain inspections put corn at 35 million bu., up slightly from the prior week, with South Korea and Mexico the leading destinations. Soybean shipments of 51.8 million bu. were down from the prior week, with China again the main destination. Wheat shipments of 12.7 million bu. were up from the prior week and were led by Mexico and Nigeria.