Fundamentally Speaking
Corn & Soy Harvest as of Oct. 19th
The dynamic action this month in corn and soybean futures is certainly giving traders the impression that the harvest lows have been set.
The rain delayed U.S. harvest appears to be one of the main reasons with potentially adverse impacts on both quality and quantity.
This untimely precipitation is also alleviating the much feared storage crunch where this year's monstrous row crop harvests would overwhelm available farm storage space resulting in forced producer sales at the tail end of harvest pushing values down to new lows.
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The accompanying chart shows the percent of the U.S. corn and soybeans harvested as of October 19 going back to 1981.
This week's crop progress figures reported 31% of the nation's corn crop harvested as of October 19 vs. the 53% five year average and 53% of the U.S. soybean crop combined as of that date vs. the 66% five year average.
Save for 2008 and 2009, this is the slowest corn harvest pace since 1996 while with the exception of 2009, this year's soybean harvest progress is the slowest since 1990.
The lagged soybean harvest progress amid sky-high crush margins and a strong early season export lineup for both soybeans and soybean meal has depleted the supply pipeline leading to the sharp pop in values.
Though not to the same degree, available supplies of corn have also tightened given the inclination of producers to store corn and sell soybeans right off the combine.
(KA)
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