Corn and soybean futures fell to new three-year lows on Monday in one-month contracts on the Chicago Stock Exchange, amid abundant global supplies, a factor that intensified pressure on American farmers.
The futures of corn They remained at the level they had touched on Friday, when they fell to a minimum since November 2020. The immediate month contract plummeted around 16% in 2024 and 38% from a year ago, after record harvests in the United States. United States and Brazil. Soybeans, for their part, also operated at the lowest value in the last 3 years.
As a result of these prices, American farmers, who maintain large inventories of corn stored from last year’s harvest, They regret not having sold more when prices were higher.
They also face limited domestic demand for corn to feed animals after ranchers reduced head numbers to their lowest level in decades. The United States also faces competition for export sales from South American suppliers. Thus, corn for March fell to US$160, a ton.
Soybeans: what is behind the price drop.
The soy In May it fell to US$272, a ton. It should be noted that last week, US soybean exports fell short of even a quarter of weekly estimates.
In this sense, the United States Department of Agriculture (USDA) warned that the US weekly soybean export sales reached 55,900 tonnes for 2023/24 in week ended February 15compared to analyst estimates of 300,000 to 800,000 tons.
This shows that buyers are heading to South America, where Brazilian soybean export prices have a strong discount compared to those of the United States.
However, “unfavorable weather in the United States and interruptions in spring planting could trigger a possible rebound”said Rich Nelson, Allendale’s chief strategist.
“We can argue that there is a drought in Iowa and parts of Nebraska. We can argue that the summer weather outlook for the Plains could be a little dry,” he said. “These are valid issues. It’s probably not time to negotiate them yet.”
Source: Ambito
