Corn is emptied into a grain truck in October 2014 north of Mason City.

AARON THOMAS, The Globe Gazette

Corn and soybean futures likely will take early 2018 price signals from rainfall over South American fields and from news of export demand — especially from China.

“I tend to think we are near lows here,” said Jack Scoville of The Price Futures Group. “As soon as we’re back from the holidays, if the drier trend continues, we could be off to the races.”

Some of those dry corn and soybean-growing areas in Argentina and Brazil received rain in mid-December, but they need more rain across wider areas.

Iowa State Extension economist Chad Hart said South American weather is high on his list of market factors, but he’s also watching U.S. weather.

The 2017 crop year started with good soil moisture in most corn and soybean-producing areas.

“That helped us survive and sort of thrive in what was a fairly substantial drought, especially in the northwest Corn Belt,” Hart said.

Now, much of Iowa and states to the west and south are dry.

On the demand side, Scoville said, “We want to keep the Chinese interested in U.S. soybeans.”

In the first 14 weekdays of December, USDA issued five announcements of soybean export sales to China.

For corn, Scoville said farmers should keep an eye on ethanol demand. Supplies have been building a little, which “could be a problem for corn.” In the week ended Dec. 15, ethanol stocks stood at 22.3 million barrels. In December 2016, weekly stocks were 18.5 to 19.1 million barrels.

Corn export sales surged in the week ended Dec. 14, but before that had been “less than spectacular,” Scoville said.

“We need the export demand for corn,” he said.

In Hart’s view, “Demand has been phenomenal in the past five years, but supplies have been more phenomenal.”

The demand base is good for feed and fuel, and exports have been strong enough to help move big crops.

Hart said news about NAFTA and other trade agreements will be important to watch — not only from the presidential level but also from bureaucrats involved in negotiations, who seem to be more positive about progress.

In view of strong demand, “low prices are more of a supply issue,” so weather news can have an impact on prices, Hart said.

A price-supporting surprise before April could come from trade-related news. Starting in April, Hart said, look for weather rallies that follow the pattern of recent years.

Roy Leidahl is managing editor of Iowa Farmer Today, Missouri Farmer Today and Illinois Farmer Today.


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