Sell Soybeans for Cash Needs
Darrel Good, Agricultural Econ
The United States Department of Agriculture has reported the size of this year’s soybean crop and for the second month in a row it has increased the size of what was already a record breaker. Todd Gleason reports that trend is likely to continue.
USDA in its October Crop Production report…
2:07 radio self contained
USDA, in its October Crop Production report, raised the average national soybean yield by eight-tenths of a bushel. It now stands at 51.4 bushels to the acre and about 4.3 billion bushels strong. It is already a serious record breaker, but not likely big enough, yet, says University of Illinois Agricultural Economist Darrel Good.
Good :25 …what we are looking at right now.
Quote Summary - Well, I think, taking all the evidence together, saying now that we got bigger in September, and we got bigger in October on soybeans, and the crop is already very big…I think would point to another small increase in the yield forecast in November and perhaps in January as well. So, maybe not by a lot, but I certainly wouldn’t expect the number to come down from what we are looking at right now.
However, even in the face of a record crop, the price of soybeans has remained fairly strong. This tells Darrel Good farmers should be a little patient as they contemplate when to sell. It might be worth waiting to see how the South American crop unfolds. Although, the U of I number cruncher does have a few caveats.
Good :25 …still a little more holding on corn.
Quote Summary - If I had to choose to sell one or the other, I would still be a seller of soybeans. This is because of the returns that the current price is offering to those that have above average yields this year. It is still a fairly large gross income. So, I think from a risk management stand point, it would lean you towards selling soybeans and still a little more holding on corn.
For reference USDA has established, this month, the expected mid-point national cash price received for soybeans by farmers from now until next fall at $9.05, with corn at $3.25 and wheat at $3.70.
You may read Darrel Good’s thoughts on the markets each Monday afternoon on the FarmDocDaily website.