Last week we saw a big move higher in corn and soybean prices. While profit taking kicked in on Friday, Jim Bower, with Bower Trading, says we are entering the time of the year when the corn market historically moves higher, “Looking at the historical data, around the first part of February the corn spreads tend to bottom out and then begin to move higher.” He added this will continue until about mid-May when the market feels assured of crop production for the current year and will then begin to take premiums out of the market.
As for soybeans, Bower says crop and weather prospects in South America look good, and this may limit price gains in soybeans, “But this is no time to take your eyes off the market.” He reminds farmers that problems in South American last year did not develop until late in the season. He added that, right now, demand is the driver in the soybean market.
Speaking of soybeans, Bower says he is finding that more and more producers are looking at higher soybean production in 2017, “Especially larger producers are taking a close look at the profitability of soybeans and, for the first time in a long time, are telling me they plan to make cuts in corn production and increases in soybean production.”
For more information, contact Bower Trading 1-800-533-8045.
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