What can corn growers expect from the markets in 2019? In Ontario, will sufficient markets be found for high DON corn? After three years of sideways trade, will world markets finally break the mold and push corn higher?
On this edition of RealAgriculture’s Corn School, host Bernard Tobin travels to the ‘Agridome’ at Dresden, Ontario to get Philip Shaw’s take on the 2019 corn market. The well-known ag economist, market commentator, and farmer says he’ll be keeping a keen eye on the futures market for opportunities to contract crop. He’s already seized opportunities to sell some 2019 corn at $5/bu. “It never hurts to contract where you are comfortable and profitable,” he says.
With huge U.S. corn demand— 15 billion bushels and growing — there is upside potential, but the China-U.S. tariff war still looms and could play a key role in determining whether those opportunities materialize. If the two countries remain at loggerheads there will be fewer soybeans planted in 2019 and a lot of those acres will move to corn, says Shaw.
In the interview, Shaw also discusses the role ethanol has played in creating markets for Ontario corn. With 35% of the province’s corn now going to industrial uses, including ethanol, the gasoline market has taken a lot of the export pressure off the crop; it’s also been a good option in helping manage disposition of the high DON corn. Shaw calls the Ontario Ethanol Growth Fund, which poured $520 million into ethanol plants, the “most successful provincial agricultural policy ever.”
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