Time to Price '15 and '16 Crops? A Bearish Theme Prevailed at Cereals NA Conference

Are you ready for corn prices down around $2.70/bushel, or soybeans under $7 next fall? Those numbers were included in some of the projections shared in Winnipeg this week, as market analysts and traders from around the world gathered for the second annual Cereals North America market outlook conference.

The conference was organized and co-hosted by CWB Market Research Services and Chicago-based advisory firm AgResource Company.

Despite the recent rally led by soymeal in grain and oilseed markets, the need for farmers and grain buyers to adjust to lower prices for the next few years was a recurring theme at the event.

“We’re lacking a demand driver, and as we think forward, we need to build demand with lower prices over numerous years,” explained AgResource president Dan Basse in the video above, noting the two main demand drivers over the last few years — growth in the biofuel market and China’s economy — are both slowing demand.

He described the recent rally as a short-term bump in prices due to logistical challenges with soybean meal in the U.S.

“A lot of this rally is due to railcar dislocations in the United States. Unfortunately, railcars will find their ways to the right spots and we’ll find availability of supply. We’re double-booking on meal, both on truck and rail,” he noted. “I think this is a short-term phenomenon, maybe over in the next week or two.”

That means the current market should be viewed as a pricing opportunity, not only for next year’s crop, but for 2016 as well, suggested Basse.

 

Leave a Reply

 

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Privacy Preference Center

Necessary

Necessary cookies help make a website usable by enabling basic functions like page navigation and access to secure areas of the website. The website cannot function properly without these cookies.

gdpr, __cfduid, PHPSESSID, wordpress_test_cookie, woocommerce_items_in_cart, woocommerce_cart_hash, wp_woocommerce_session, wordpress_logged_in, wordpress_sec, wp-settings, wp-settings-time, __cf_mob_redir, wordpress_cache, realag
__cfduid

Marketing

Measuring interactions with the ads on the domain.

__gads,fsk_ut_2317
scmtid,v,a,JSESSIONID
IDE

Statistics

These are used to track user interaction and detect potential problems. These help us improve our services by providing analytical data on how users use this site.

_ga,_gid,_gat,_cb,_chartbeat2,_chartbeat4
_ga,_gat
_ga,_gid
metrics_token

Preferences

Preference cookies enable the website to remember information that changes the way the website behaves or looks, like your preferred language or the region that you are in.

chartdefaults, comment_author, comment_author_email, comment_author_url
JSESSIONID, _os_session,anonymous_votes,csrf-param,csrf-token,user,user-id,user-platform,intercom-session,intercom-lou,intercom-session
personalization_id, tfw_exp

 

Register for a RealAgriculture account to manage your Shortcut menu instead of the default.

Register