PRICE

FROM PAGE 12 torically tight, in the range where prices are high, but I think there is some reason to think old crop prices might not maintain the levels that USDA is projecting. There’s room for some downside,” Janzen said.

He added old crop corn prices levels are likely to remain high in the short run. However, higher ending stocks mean higher beginning stocks for 2023-2024 and an increased probability that the 2023 harvest will push prices lower.

“The reason for some of this pessimism is corn export sales are well below the fiveyear average pace and below last year,” Janzen said.

Corn export sales through Nov. 17, 2022, were about 699 million bushels while the previous five-year aver - age level is approximately 1.047 billion bushels. Sales near this previous five-year average level are necessary to reach the USDA forecast level.

“There is some recent optimism for corn exports given recent large sales to Mexico and improved prospects for barge traffic on the Mississippi River to facilitate grain movement to export terminals, but missing early export sales may be too large to be completely replaced with sales later in the marketing year,” Janzen said.

Soybeans

The farmdoc projections concurred with USDA’s 2022-2023 balance sheet that has an average yield of 50.2 bushels per acre and a total supply of 4.634 billion bushels.

Exports are penned in a 2.045 billion bushels, crushings of 2.245 billion and ending stocks of 220 million bushels, putting stock-to-use at 5%. The season average price is projected at $14 per bushel.

“Soybeans are slightly below trend line projected yields for 2022. It was a slightly smaller crop than we might have planned for. That’s kind of underpinning the market,” Janzen said.

“There is pretty strong use. The crush number is up from the year before. Exports are right around where they have been the last few years. We have a tight market situation where we’re carrying out 5% of use. That means relatively strong prices.”

Soybean export sales to Nov. 17 were similar to last year, above the previous five-year average pace and on track to meet USDA projections.

Wildcard

The wildcard in the current marketing year outlook is basis levels and what’s hap- pening on the transportation side.

“We do have kind of a strange situation that has eased somewhat. In late-October there were very poor basis levels along the Mississippi River and now they’re strengthening to some degree,” Janzen said.

“In the corn market, the large drought area of the Plains is trying to draw corn into feedlots in Oklahoma, Kansas and Nebraska. It was a region where there wasn’t much of a corn crop. The market needs to move corn in that direction. Basis is doing that work by implementing some incredibly strong bids there.

“It’s an unusual spatial market structure that we see ourselves in.”

Tom C. Doran can be reached at 815-410-2256 or tdoran@shawmedia.com. Follow him on Twitter at: @ AgNews_Doran.