Grain Marketing

Grain Marketing


Jul 05, 2022

by Diana DeHart

Crop conditions Crop conditions across this region continue to vary but considering what the crop has been through in this area this growing season things look relatively good. I’ll start by noting that the US Drought Monitor for the week of June 28th shows no change in drought improvement throughout most of the Western Midwest and Southwest, except for nearly all of New Mexico and a small portion of southwest and south central Colorado which improved marginally. A slight degradation was noted in portions of eastern Texas, southwestern and south central Missouri, and northern Arkansas and portions of Mississippi. No improvement was seen in Nebraska’s drought conditions or the driest areas of western Iowa. Throughout the month of June, I have traveled across parts of central and east central Iowa (along I-80 and highway 30 east & west) and down I-35.  Crops look good across most of this area of Iowa, although it is evident, they were planted later than normal. Northwest Missouri, Southwest Iowa, Southeast Nebraska, and Northeast Kansas crops look the best of anywhere I have traveled this month.  On average the area planted later than normal, but the crop has made great progress and is in great condition.  Northcentral Missouri and east experienced wetter conditions early in the planting season and that crop is not as mature and many soybeans were still being planted the last week of June.    Lincoln, NE to Grand Island, NE is an area that has been hard hit with high winds and hail damage.  Many irrigation systems and properties have been damaged in addition to the crop.  As of June 24th, much of the corn crop was once again emerging and nearly all fields had been replanted, but irrigation repairs were far from complete. Traveling to eastern New Mexico in mid-June confirmed the extremely hot and dry conditions across the panhandle and southwest.  Wheat harvest was well underway, but producers in Oklahoma, Texas, western Kansas, and eastern Colorado confirmed a poor yielding wheat crop.  Portions of this area did receive some beneficial rains in late June, but the area is still moisture deficit, and any wind and high temps will take an additional toll on those crops if they persist into July.   Basis for corn in the region has remained strong, especially for old crop corn.  Feedlots in western Kansas have been reporting $2.00+ versus the July, with some trades near $3.00 over.  Even in western Missouri and northern Arkansas we have seen old crop corn basis values at $1.50 or better.  New crop corn basis has remained steady in most areas with some areas like the Arkansas feed market working slightly higher.  Soybean basis remains steady to slightly higher in the Kansas and western Missouri areas as well, although not as spicy as the corn market.  Wheat basis has lost some ground during harvest as expected.  With a short HRW crop and futures down significantly I would expect basis levels for wheat delivered post-harvest to improve.   Upcoming events Check out these upcoming events in our region. Oklahoma Cattlemen's Association - Norman, OK, July 22-23 Arkansas Cattlemen's Association - Hot Springs, AR, July 28-30 Texas A&M Beef Short Course - College Station, TX, August 1-3 Coming County Fair (stop by our booth!) - West Point, NE, August 11-14 Community Builder events in the following locations: Fort Dodge, IA, July 12 Huxley, IA, July 13 Keystone, IA, July 14 Anita, IA, July 19 Independence, IA, July 20 Monticello, IA, July 28 Perry, IA, August 4 Marshalltown, IA, August 9 Grinnell, IA, August 10


Jul 05, 2022

by Bill Prince

Greetings from the Eastern corn belt! The heat we received early in the season has plants up and growing. However, irrigators have been running, where available, as Indiana and Ohio have been dry. Signs of stress are visible, and farmers are saying corn is rolling up and needs moisture. Producers are concerned about what this might do to beginning ear development prior to pollination. The later planting start may push pollination back a week or two allowing for moisture to develop. Higher temperatures can also allow for greater possibility of pests and disease. Crop conditions Condition scores for 6/27/22 showed an 11% decline in GTE for Indiana, a 9% decline in Ohio, and a 24% decline in Kentucky. The national average is 67% GTE better than 64% last year, on a crop we thought looked pretty good. We will continue to monitor weather patterns and keep you posted in our communications. The good news is spot basis is still strong. If you see a fall basis that looks average or above, it may be a good idea to take a little risk off the table. Hats off to Kevin McNew, Chief Economist at FBN®, and his team for their excellent work and analysis on the . The results were directionally in line with the USDA numbers. Thanks to all of you who participated, as the data is from you and the results are for you. Upcoming events Check out these upcoming events in our region.


Jul 05, 2022

by Nicole Tonak

Upper Midwest/Dakotas have finally finished up with Spring planting. You, the producer, did a great job of getting as many acres as possible planted, under some tough conditions. Unfortunately, not all acres were planted, there are PP acres scattered throughout the region. Crop conditions As Spring planting progressed over the past few months, acre changes due to weather were inevitable. Spring Wheat planting was a struggle early on, and even though some acres were switched, ND was able to get most wheat acres planted. Higher input costs, along with grain markets, pushed some corn acres into beans throughout this region. In much of the northern region, even though seed was planted into soggy ground, and not under great conditions, things are drying out quickly. With the crop now emerged, it’s trying to catch up from the late planting dates, however, we are still behind. Early planted Wheat acres look good and are on track so far at this point. Corn and beans are for sure behind. Spraying has been underway, and with the slow growing to this point it looks like there could be additional spray costs ahead to keep things under control before canopy. The mid-June change to cooler temps has taken some stress off during these early growing days, although it looks like the heat will reappear in July. Moisture will be needed to compensate for any excessive heat that comes in the next 30 days. Recent market setbacks ahead of USDA’s June 30th acreage report did cause concern among some growers with uncertain yields projected throughout the upper Midwest. As advisors, we want you, the grower, to be comfortable with the sales you’ve made or additional sales yet to make.  With this yield uncertainty, I encourage you to watch for any changes +/- and adjust your percent sold accordingly to maintain accurate records ahead of harvest. If you have any questions regarding the markets or how to protect that risk going through the summer, I’d be happy to visit with you! Basis levels throughout the region are still strong. Most facilities/end users have rolled and are using new crop futures, making basis level adjustments to complete the cash prices for summer. As you look to summer cleanout, be mindful of road construction/detours and closures to ensure a seamless trip to the scales. Stay safe, Stay hydrated!  Enjoy your summer. Upcoming Events Check out these upcoming events in our region. Minnesota Honey Producers - St. Cloud, MN, July 6-8 Dakota Fest - Mitchell, SD,  August 16-18 R Calf Annual Convention - Deadwood, SD, August 18-20


Jul 05, 2022

by Kevin McNew

Another big USDA report, and another moment where many commodity analysts were caught off guard about acreage estimates.  Heading into the June Acreage report, traders collectively believed USDA might increase corn acres by 400,000 from USDA’s 89.5 million estimate in March. Conversely, the trade expected a modest decline from USDA’s March soybean estimate of 91.0 million to 90.5 million in June.  Ahead of USDA’s June 30th report, —  based on member contributed data — which told a much different story. Namely, soybean acres were likely to fall much more aggressively than the trade expected, and our peg was at 89.0 million acres — a full 1.5 million acres less than the average of analysts. Indeed, USDA’s June soy acreage forecast at 88.3 million acres was a shock to the trade but not to s farmers who had read the report and were prepared for a bullish soy estimate.  For corn, USDA was mostly where the trade expected at 89.9 million acres, and although was on the high side of the trade at 90.4 million acres, we felt the bullish bean / bearish corn story warranted corn pricing action ahead of the report. On June 28, 2022, issued sales recs at $6.60 Dec corn futures ahead of the report, and with current post-report values of $6.20 this has seemed like a prudent course of action. Key analysts' expectations vs. USDA's June 2022 Acreage Now two years in as a forecasting group, has demonstrated its proven accuracy around key acreage reports. This is a result of a large number of farmers participating in the surveys, which leads to actionable insights and enhancement of our member’s marketing abilities.  The table below illustrates forecasting accuracies for corn and soybeans of various analysts for the last four acreage reports during which has used member surveys to provide forecasts. Compared to the shown analysts, has achieved a much lower forecasting error during this period with an average error of only 1 million acres. That is 30% better than the next best forecaster, and well below most analysts —  which have substantially larger errors of 1.8 to 2.5 million acres. We believe this illustrates the power and uniqueness of ’s crowdsourced data approach for using member data to improve marketing outcomes. Corn and soy acreage forecast error, 2021-2022 Source: FBN/Reuters/USDA ’s June 2022 Performance on Other Crops Crop FBN USDA Avg Analyst (Range) Spring Wheat 11.4 11.1 10.8 (10.4-11.5) Durum 1.8 2.0 1.8 (1.7-2.0) Cotton 12.4 12.5 12.2 (11.0-12.7) Sorghum 6.6 6.3 6.5 (6.3-6.8) Rice 2.42 2.34 2.45 (2.25-2.6) Source: FBN/Reuters/USDA What it means for the farmer Survey participation is key.  If you were a respondent, thank you. With the report in your hands ahead of others, you were set up to make key marketing decisions before USDA’s release. 


Jun 27, 2022

by FBN Network

Providing critical intelligence based on the collective actions of our farmer members is a key mission of Farmers Business Network®. That’s why we’re excited to share our annual June Acreage Report as a deliverable to help you make critical crop marketing decisions ahead of USDA’s Acreage Report on June 30th.  Despite some weather-related planting delays in the Northern Plains, we found that increased acreage in Minnesota, Wisconsin and Ohio likely helped push the corn acreage number above the USDA's March reading of 90.4 million acres, up from USDA’s March estimate of 89.5.  Soybean acres are pegged at 89.0 million acres, off from USDA’s March forecast of 91.0 million, also pegged to weather in the Dakotas.  Download the 2022 U.S. Acreage Report “The USDA report usually drives volatility that's three to four times greater than a typical trading day," said Kevin McNew, Chief Economist at FBN®.  "With the weather challenges across the country and an uncertain economic climate, our Acreage Report aims to provide our farmer members with the most comprehensive data and intelligence ahead of this report so they can make the best decisions for their operations," said McNew.  Grain markets continue to be on edge as we reach the midpoint of the US growing season. In March, USDA’s Prospective Plantings report suggested farmers intended to plant less corn and more soybeans than in 2021, with forecasted US corn acres at 89.5 million acres and soybeans at 91.0 million acres. They will release their latest acreage estimates on July 1 based on their farmer survey conducted in early June.  Farmer summary We asked members what their actual planted acres were across 9 key crops. Here are some of the key findings from the survey. Corn  Corn acres are expected to climb to 90.4 million acres, up from USDA’s March estimate of 89.5. While corn acres were down by 500,000 in North Dakota and South Dakota versus the March estimate due to poor planting weather, other states were either mostly unchanged to higher. Key states increasing corn acres versus March were Minnesota (up 400,000), Indiana (up 200,000), Ohio (up 200,000), and Wisconsin (up 200,000). Soybeans Soybean acres are pegged at 89.0 million acres, off from USDA’s March forecast of 91.0 million. Again, weather caused North and South Dakota farmers to plant less soybeans by 500,000 acres versus March’s forecast, but other states also pulled back on soy plantings as some switched more into corn, cotton and spring wheat. What it means for the farmer Many farmers have faced challenges this spring as unusually cold and wet weather handicapped planting progress in the Upper Midwest and Northern Plains. Meanwhile, in the Southwest Plains, persistent drought took its toll on winter wheat yield potential, and likely influenced some spring planting decisions as farmers sized up the risks of the drought extending into the summer. Get the free report If you'd like to read the full report, get your free copy today. Members can access this report and more in the  Reports section  of the   app.


Jun 24, 2022

by Kevin McNew

After a steady climb over the past six months from $5.50 to $7.50 a bushel for the bellwether December 2022 futures contract, the past three weeks have seen relative choppy trade keeping prices hovering around the low $7 mark.  USDA’s acreage report at the end of June along with US growing season weather will be key drivers for deciding if futures can reach new highs heading into harvest. Likewise, basis levels for fall delivery will be adjusting as we get closer to harvest and estimates of new supplies start to dial in. Download the 2022 U.S. Acreage Report Current cash forward contracts which quote new-crop basis for delivery this fall have been generally trending higher in the Western Cornbelt but flat to a bit lower in the Eastern Cornbelt. Last year had big corn crops, especially in Ohio and Indiana, which has kept spot basis levels in those states below normal for much of the past six months. Meanwhile in the West, dryness in the Plains and lack of grain supplies has underpinned spot basis for much of the year.  Is this a good time to be locking in the new-crop basis for delivery at harvest? Or would you be better off waiting for new-crop basis to improve? To answer that, we examined 2006-2021 basis bids at harvest for key states and developed our Basis Model to help guide marketing decisions. This model is tuned into a number of factors like US and local production, stocks, ethanol, and exports and gives a basis forecast based on the expected supply and demand situation for this fall.  The results of the forecasts are presented in the chart below for 15 key states. In addition, we illustrate the current year new-crop basis averaged across buyers to compare whether current basis offerings are above or below expected basis levels at harvest. Of the 15 states, only 2 states (KY and MO) show current new-crop basis quotes that are at or below the forecast value for the state. Most states have forecast basis that not only is higher than current quoted basis for that state, but that also is above the long-run average basis at harvest. The key drivers of this are declining US carryout expected for 2022 as well as fairly sizable changes in local production due to acreage changes between 2021 and what is expected in 2022. If USDA were to find even lower acreage in the June survey, and/or if yield potential erodes over the season, then this could add more basis upside this fall. Falling production combined with near-record exports and ethanol production expected in 2022 likely keeps local basis supported heading into harvest, and yet another market where farmers are better off waiting to price on.  New-crop corn basis forecasts Click here to enlarge the image. What it means for the farmer A tightening US and global corn market is unlikely to get corrected in the next six months. Most end users are not eager to bid up basis for this fall, but as the growing season progresses we expect the corn crop size to continue to be downgraded, which likely opens doors for better basis opportunities closer to harvest than what exists today.


May 31, 2022

by Diana DeHart

Introducing Diana DeHart - Market Advisor Regional Representative covering the Lower Midwest & Central Plains I've been working as a Farm Market Advisor with  since 2018  and I've been employed in the grain industry since 1994. I grew up on a grain and livestock farm in NW Missouri, and still farm and raise cattle in the area with my family. I started my career in the grain industry with a Co-op in western Indiana as a grain merchandiser.  For 3 years I worked for ADM as a merchandiser, commodity broker and grain facility manager in west central Indiana. In 2005, I moved back to Missouri and worked for a regional co-op in west central Missouri as the grain coordinator. In 2016, I moved back to northwest Missouri to my family farm and worked for a newly constructed shuttle loading facility nearby. In May of 2018 I joined and I have enjoyed the opportunity to work with producers and help them manage their grain marketing risk. May brief The western part of this region has been extremely dry while the north and eastern areas have been fighting rain. Planting in the Lower Midwest areas has been delayed, but mid-May weather gave many producers several short windows that allowed them to get corn in the ground. The Deep South has seen a fair amount of prevent plant claims for corn.  The Wheat Council wrapped up their Kansas tour with an estimated yield of 39.7 bushels per acre versus the average from last year at 47.4 bushels. Production is seen at 261 million bushels, implying USDA’s harvested area total is viewed as too optimistic by the tour. We believe protein shouldn't be an issue for the HRW crop this year.  Old crop basis is holding firm for soybeans and corn in most areas. New crop soybean basis remains steady to slightly weaker. If you'd like to talk about your farm business and how it's being impacted by market dynamics, you can call/text me at . Or .


May 31, 2022

by Bill Prince

Introducing Bill Prince - Market Advisor Regional Representative covering the Great Lakes Region I’ve been working with since 2017. Prior to I worked with Cargill as a Market Advisor helping keep customers informed of the issues driving the markets and incorporating details of their farming operations into actionable suggestions to help them make risk management decisions. Understanding your business and how you like to operate is key to a successful relationship. May brief The cold wet start to the Spring planting season has turned around the past couple of weeks. After many long days, much progress has been made with completion in sight. Some areas of Ohio and Michigan are still experiencing high moisture and it is causing delays. The National Weather Service is calling for warmer than average temps, except for MN, ND & MT. Precipitation looks to be dry in the western corn belt and more normal in the Great Lakes Region. Spot basis is strong and If you want to talk about your farm and how it’s being impacted by market dynamics, call or shoot me a text at . Or .


May 31, 2022

by Nicole Tonak

Introducing Nicole Tonak - Market Advisor Regional Representative covering the Dakotas and Upper Midwest Region I started with in 2019 as an outside Farm Market Advisor working for local producers helping to manage their grain marketing risk. Prior to I honed my risk management skills by working for a brokerage company and  with Cargill as both a Contract Service Rep. and Farm Market Advisor.  I grew up in, and still reside in East/Central South Dakota. I enjoy working with producers, and learning about their farm business to  further understand and assist in marketing strategies for their operations. May Brief Cooler, wet weather through May has caused significant planting delays throughout the Upper Midwest, especially in the Dakotas. May 22nd US corn planting report was 72%, second slowest for the date in more than 25 years. North Dakota however came in at only 20%. As the Crop Insurance Deadline of May 25th for corn has passed, producers are contemplating the production risks of late planting, changing their acres, or filing for prevent plant. Spring Wheat acres, also in limbo as we close out May, are causing additional strain. If you have any questions as to what decision is best for your Farm Business, contact your crop insurance agent or market advisor. One last Storm system will move through the end of May, before June brings the area warm/dry weather. This will allow a few good planting days ahead of the June 10th Soybean deadline for crop insurance. Old/New crop Basis levels remain steady and currently better than average. If you'd like to talk about your farm business and how it's being impacted by market dynamics, you can call/text at 605.221.8296 . Or .


May 23, 2022

by Rejeana Gvillo

Twenty cars carrying around 80 crop scouts left Manhattan, KS early Tuesday morning (May 17)  to fan out across the state and sample wheat yields. This year, wheat yields in Kansas are a big unknown as divergent weather has created yield question marks. In the Northeast part of the state, growing conditions have been mostly favorable hovering around normal for this time of year. But, as you move west and the south, drought and heat have taken their toll, cutting into yield prospects.  Last week USDA released their May forecast for winter wheat yields and pegged the Kansas state yield at 39 bushels per acre, off sharply from last year’s reading of 52 bushels. The estimated yield from the tour came in at 39.7 bushels per acre versus the average from last year at 47.4 bushels.  Production is seen at 261 million bushels, implying USDA’s harvested area total is viewed as too optimistic by the tour. On this year’s tour, Rejeana Gvillo, ’s Senior Economist, was on the road participating in the tour and giving first hand perspectives from her route. Here are some of her comments and observations. The western half of the state is in need of moisture. Having been on the tour previously, this was the first time I did not get damp when walking into a field before lunch.  It was so dry and hot, dew was nonexistent until we were in the Wichita area. There were many (what I would call) aborted (solid white) wheat heads from a combination of freeze damage and/or lack of moisture. There are limited pest/disease issues because it is so dry. Expectations for an above-average protein crop are present. The bulk of the crop was flowering or in the milk stage thus rain in the coming week or two could help and definitely maintain the crop - but would not substantially alter my views on the overall health of the KS wheat crop. Harvest is 2-6 weeks off, depending on the area. In several western/southern fields, stalks are so short that a combine header won’t be able to cut the wheat. My opinion is that USDA’s harvested area expectation is too large. Therefore I expect harvested area to come in lower in the June Acreage report. Winter wheat crop tour - FBN Economist stops Key findings and insights Day 1 Day 1 should have been a pretty decent crop based on USDA’s crop conditions showing the crop rating that was mostly fair. Of the 13 stops, only one stop showed a field level yield that was above last year’s county yield. Freeze damage was observed on stop 5, and yield in that field was off 20 bushels from the county average in 2021. As the route headed West across the northern reaches of the state yields definitely got lower, reflecting the challenging growing season. Read more about the key findings from Day 1. Day 2 Day 2’s scouting tour headed into the worst areas for yield and the findings confirmed how bad it is. Yields fell dramatically as the tour hit the SW corner of KS. But as the tour reached the south central region of the state, yield conditions began to improve.     Read more about the key findings from Day 2. Day 3 Day 3 offered no surprises.  As the tour headed north of Wichita towards Manhattan, but with only a few miles between the cities, Rejeana made just two stops to wrap up the final day of the tour.  Wheat tour coming up short Click here to enlarge the image. Stop 26 - Mulvane KS Stop 27 - Mulvane KS