Marlin: Harvest and low prices drag on

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Corn snow
A harvested corn field, with snow.

The day will come when we don’t talk about harvest anymore. That usually happens when we get to the first day of December. Not this year. 

Harvest drags on in some corners of the Corn Belt. As of Dec. 1, USDA reports that the corn crop is 89 percent harvested, up from 84 percent the week before. 

Last year, in a long, wet harvest, we were only at 84 percent at this time, but the average is 96 percent. Hard to believe we are ahead of last year, but we are. Remember, last year we planted late, had great weather and a good crop, but wet weather when we got to the late harvest. 

Ohio is now reported to be 90 percent harvested in corn, up from 83 percent, but lagging the 95 percent average. Normally USDA quits reporting harvest at this time, but they will continue for at least one more week. Sadly, some areas are much worse than the average. 

Dakotas down

I have previously mentioned the Dakotas, where much of the corn is being left in the field for dry down and the hope that natural dry down will increase the test weight. Corn being harvested was running 47 pounds test weight with moisture in the 40s for some. It never really got mature, and now it remains to be seen if it will be harvested next spring or abandoned. 

North Dakota is reported to be only 36 percent harvested. Wisconsin and Michigan (that state up north, I should say) are at 66 percent complete, with snow stopping them now. There are over four millions acres to harvest, and that represents 650 million expected bushels. 

Soybeans harvested

The soybean crop is reported to be about all harvested, with Ohio at 95 percent and the U.S. at 96. I do see the occasional field of beans still standing in our area. They may be there for a while. 

I remember combining 50 acres of beans on frozen ground in February one year, and I remember it with relief that I got it off and relief that I don’t have to do that ever again. 

All of these problems would suggest that the crop is still over-estimated by USDA, but there will be no change in production figures in the December reports, just in the January final report. I am beginning to wonder if even the January report will report a crop as small as many experts believe is reality. 

Prices erratic

Soybean prices especially have been erratic as the trade dance with China has continued. Just when it looked like the Phase One deal would be struck in early December, President Trump signed the bipartisan (it really is possible in Washington today) bill to support Hong Kong in its struggles with China. 

The “one country, two systems” agreement that was forged as a 50-year transition to China taking over Hong Kong when Britain’s 99-year lease ran out has been abrogated by the Chinese recently. The result has been nightly demonstrations and riots. 

Supporting rebels? 

The Chinese expressed outrage that we supported the rebels, but privately it was acknowledged that they expected it. The rebels have been flying American flags and singing our national anthem, causing the Chinese to say the U.S. is behind the demonstrations. It seems to actually be the spirit of our revolution that is at play here. 

Historians will tell you that the American Revolution was not actually a real revolution, but a struggle to preserve the status quo. The American colonies had been allowed to form their own legislatures and pass their own laws for running the colonies. When British laws were passed that greatly affected the colonies, the Americans revolted. It is much the same in Hong Kong. 

Agreement coming

Soybean prices dropped late last week in fear of how the Chinese would retaliate, but it now looks like the retaliation will not be serious. Maybe we can get back to the Phase One talks. I guarantee that the agreement will come when hopes appear to be dashed, as that is the Trump pattern. Stay tough, then agree. 

The post-harvest period is normally a time for advancing prices. The market is poised for that advance to be more than normal this year. Trade deals, lower production numbers, and the realities of a balance sheet for the crops that shows prices too low for likely carryout will all contribute. 

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