Grain markets were “off to the races,” after the U.S. Department of Agriculture (USDA) released its November World Agricultural Supply and Demand Estimates (WASDE) report.
“We saw a positive, bullish report,” says Jim McCormick, branch manager of Ag Market, as he reflects on the November WASDE Report.
“The government lowered the corn yield from 178.4 to 175.8, and lowered the bean yield from 51.9 to 50.7. On top of it, they raised corn demand, (and) left bean demand unchanged,” McCormick says. “The corn carryout came in at 1.7 billion bushels, below expectations and the bean number fell to 190 million bushels, also lower than expected. So we’re off to the races.”
December corn futures ended the Tuesday trading session 15 1/2 cents higher at $4.23, while front month soybean futures closed 35 1/2 cents higher at $11.46. McCormick encourages folks to keep in mind how far we’ve come and “reward a rally.”
“Keep in mind the rollercoaster we’ve been on this year. In March, producers were bullish, spreads were narrowing, basis was strong, (and) it looked to be a profitable year. And then the pandemic hit,” McCormick says.
“We’ve come quite a ways, and now are back to good, profitable levels,” McCormick says. “There’s a lot of unknowns out there, so what our recommendation to producers is: Don’t be afraid to reward this rally. You’re profitable; sell some. And then if you want to use options to re-own it, we would encourage that.”
McCormick believes “we’re going to keep a bid under the market into the wintertime.”
