Darrel Good
Darrel Good
exception intentions minnesota north unchanged widespread
Those intentions are widespread geographically, with the exception of Minnesota and North Dakota, where intentions are unchanged and up 240,000 acres, respectively.
appear calendar persist prices range settling trading
Prices now appear to be settling into a trading range that may persist into the first of the calendar year.
appears based current discourage increase large level prices
Based on current conditions, however, it appears that the soybean prices need to be at a level to discourage a large increase in U.S. acreage in 2006.
appears billion corn crop forecast implies market means obviously ration sensitive smaller stocks trading vice
A stocks-to-use ration of 8.8 percent, then, means 2006-07 year-ending stocks of 1.047 billion bushels, implying a crop of 9.966 billion bushels. That is, the market appears to be trading a 2006 corn crop that is 1.146 billion bushels, or 10.3 percent, smaller than the 2005 crop. That calculation is obviously sensitive to the forecast of use. A smaller forecast of use implies a smaller crop and vice versa.
billion crop near produce trend yield
A trend yield near 150 bushels, then, would produce a 2006 crop of 10.92 billion bushels.
appears corn demand prospects stronger
At this juncture, it appears that U.S. corn consumption and demand prospects are stronger than prospects for U.S. soybeans.
corn current demand favorable production relatively seem
Current world production and demand prospects, however, seem to be relatively more favorable for corn than for soybeans.
abandoned centers corn debate decline deviate due generally hard increase intentions magnitude planting potential price record red relationships spring weather wheat winter
Most analysts are on record with expectations of a decline in corn planting intentions and an increase in intentions for soybeans. The debate generally centers on the magnitude of the changes. Acreage of spring-planted crops, however, could deviate from intentions due to escalating spring wheat prices; potential for abandoned hard red winter wheat acreage to be replanted to other crops; changes, if any, in price relationships of spring-planted crops; and spring weather conditions.
august believe billion coming crop estimated growing highest larger level nearly observers oil percent recent record reporting season since south stocks year
With the growing season coming to an end, most observers believe that the South American crop will be record large, with more uncertainty about the Argentine crop than the Brazilian crop. U.S. soybean oil stocks at the end of the most recent reporting month--January 2006--were estimated at 2.477 billion pounds, nearly 60 percent larger than stocks of a year ago. Stocks were at the highest level since August 2002.
concerns continue corn crops daily decline demand driven dry exports fund growing higher ideas increase modestly net pace position prices provide raised sales season supportive weather wheat
Fundamentally, the increase in exports and export sales has been a supportive factor. Ideas that ethanol-driven demand for corn will continue to increase at a brisk pace and that U.S. corn acreage may decline modestly in 2006 also provide fundamental support. Dry weather has driven wheat prices higher and has raised concerns about the 2006 growing season for corn and other crops. Speculative demand for corn and other crops has also escalated, as evidenced by the daily tally of the net position of the fund traders.
based current implies marketing price projection ratio relationship since year
Based on the relationship between the stocks-to-use ratio and price since 1998-99, a price of $2.51 implies a 2006-07 year-ending stocks-to-use ratio of 8.8 percent. In comparison, the current projection of the stocks-to-use ratio for the 2005-06 marketing year is 22.4 percent.
appearing forecasts impact larger largest prices production reactions recent similar somewhat
Similar to corn, USDA soybean production forecasts had the largest impact on soybean futures prices in August, with recent price reactions appearing somewhat larger than in the past.
appeared direction errors forecast size study trend
There appeared to be no trend in the size or direction of forecast errors over the study period.
accurately consistent evidence harvest level provides size
That level of use is historically consistent and provides evidence that the size of the 2005 harvest has been accurately estimated.