Slow harvest, slow news, weak prices

Corn harvest 2016
Farm and Dairy file photo.

There is no lack of news in the grain markets currently, but it’s news that is closer to rumor. Traders are operating on the idea that the corn crop has been better than expected, and prices have been defensive. 

That was especially true Nov. 4, when we lost six cents on the price of December futures in Chicago, to 3.831⁄4. That was helped by the idea of an “open” harvest, or, the idea that weather was great and harvest progress was following. Actual harvest progress numbers released by the U.S. Department of Agriculture Nov. 4 did not support this idea. 

Corn harvest

The U.S. is now 52% harvested, up 11% from the week before, but this is still the second slowest harvest in 20 years, with only 2009 worse. On average, we have 75% off by now. Ohio was relatively better, if you consider the spread from current to average. We are at 45%, up from 37%. The five-year average is 69%. 

While farmers have been sweating the crop size and reporting yields that are off 10% to 18% in many areas, spec traders added to short positions again, according to the Nov. 1 Commitment of Traders report. That showed an increase of 700 short contracts for a position of 133,600 short contracts. 


This is hard to understand from a fundamental position unless you really believe the USDA idea that the crop is nearly as large as last year’s. Suffice it to say that I don’t. 

The market was slightly lower overnight, but is now trading even. Perhaps we are just getting positioned for the Nov. 8 numbers from USDA, which will include new production estimates. As hard as it is to believe, traders tend toward the idea that the USDA will increase their production numbers, and are nervous. 

This is entirely possible because they increased the corn production estimate last month. The soybean market is slightly brighter because the market is more afraid of production, and because the China trade talk keeps markets stirred up. 

November futures made a high the middle of October at 9.451⁄2. We dipped to a Halloween low of 9.101⁄2. We are currently, this Nov. 5 morning, at 9.253⁄4. Traders are actually a little positive about soybean price. The specs have added slightly to long positions, and are now long 38,800 contracts. 

Soybean harvest

The USDA reported that Nov. 3, the soybean harvest had caught up to nearly normal. We gained 13% last week, and are now at 72% nationally, still behind the average of 75%. 

Ohio is at 78%, gaining just 8% for a week when the corn heads went on every time it rained. We are closer to our average of 86% than the nation is as a whole. 

First deal

On the down side, especially for the beans, the meetings in Chile that were supposed to serve as a backdrop to the signing of the U.S.-China first phase deal has been canceled. There is civil unrest in Chile, and fears of safety for participants. Probably there was fear of embarrassment for the Chilean government, too! 

On the up side, the first deal seems to be about to happen, but don’t hold your breath. We are being told that the presidents of the two countries have been in continuous touch, and that the deal will be signed this month. That makes it within a year instead of the three months originally announced, and this is just the easy part. 


The U.S. and China have always wanted a grain deal. It is the “intellectual property” part that is difficult. Just hope that phase gets finished in Trump’s second term.

China is thought to be delaying in hopes they get a new, 78-year-old, easier president. Although our media continues to push the idea that this trade battle (it is not really a “war” yet) is bad for the U.S., it is China who is suffering. Their economy is down while ours is still booming. 

The protracted nature of the conflict has caused companies such as Apple and Samsung to flee to other shores. They would rather make new commercial contracts with other countries and move manufacturing than risk being caught in a real trade war, the kind where their products all of a sudden cost 25% more in the U.S. 


Up-to-date agriculture news in your inbox!



We are glad you have chosen to leave a comment. Please keep in mind that comments are moderated according to our comment policy.

Receive emails as this discussion progresses.