Field Crops

Weekly Commodity Market Update

Brownfield’s Weekly Commodity update featuring former OSU Extension Ag Economist Ben Brown.

This Week’s Topics:

  • Market recap
  • Consumer sentiment at two-year high
  • Oilseed outlook
  • Managed money profit taking
  • Managing when to sell
  • Record December soybean crush
  • Reports to watch

This week Will and Ben discuss marketing crops around profit taking

Market recap (Changes on week as of Monday’s close):

  •  March 2024 corn down $0.02 at $4.45
  • December 2024 corn down $.06 $4.75
  • March 2024 soybeans down $.04 at $12.23
  • November 2024 soybeans down $.04 at $11.97
  • March soybean oil down 2.19 cents at 48.16 cents/lb
  • March soybean meal down $7.50 at $355.80/short ton
  • March 2024 wheat flat at $5.96
  • July 2024 wheat down $.07 at $6.12
  • March WTI Crude Oil up $2.02 at $74.67/barrel

Weekly Highlights 

  • The December National Oilseed Processors Report showed their members crushed a record 195.3 million bushels of soybeans in December- up from 189 in November and 177.5 million last December. Cumulative soybean crush is running 40 million bushels of last years pace with USDA expected an 88-million-bushel year over year increase.
  • The US economy continues to show resistance. The Home Builder Confidence Index reported a reading of 44 increased from 39 in December and analysist expectations of 39. This signal that while contracting its not contracting as fast. Lower mortgage rates boosted confidence.
  • Consumer sentiment jumped to the highest level since July 2021 reflecting optimism regarding slowing inflation and rising incomes.
  • The US labor market remains tight as jobless claims fall under 200,000 and lowest level in 16 months. Employers may be adding fewer workers but they are holding on to the ones they have and paying higher wages.
  • It was a fairly risk on week for US commodities. Open interest positions increased for Chicago wheat (5.7%), Corn (8.1%), soybeans (4.9%), soybean oil (5.6%), soybean meal (6.2%), and cotton (2.7%) while rough rice fell (2.1%).
  • Producers and merchants increased their futures and options positions of Chicago corn more than 25,000 contracts with managed money increasing their net short position 29,819 contracts. The managed money net short for corn is quickly reaching a resistance level close to the largest net short in 15 years.
  • Managed money for soybeans also increased the net short 45.5 thousand contracts.
  • US crude oil stocks excluding the strategic petroleum reserve were down 105 million gallons while gasoline stocks increased 125 million gallons on a slight week over week reduction in gasoline demand.
  • US ethanol production pulled back to 310 million gallons but well above the 296 million gallons last year. Ethanol stocks have built to a 10 year high. The cold weather will likely slow US ethanol production over the next several weeks. Higher natural gas prices and lower ethanol prices are cutting into ethanol plant margins.
  • Export sales were bullish for corn and wheat last week while neutral for beans and grain sorghum. Sales were higher week over week across the board.
  • Weekly grain and oilseed export inspections were rather neutral. Corn, soybeans, and grain sorghum were all down week over week, while total wheats were slightly higher.
  • Friday’s USDA Cattle on Feed as of January 1 report showed all cattle on feed at 102.1% of last year.

Fall-applied Herbicide Considerations

Now that harvest is finally winding down, our thoughts change to fall weed control.   This is the best time of year to control winter annuals and some of the more difficult to manage overwintering weed species. Biennial and perennial plants are now sending nutrients down to the root systems in preparation for winter. Systemic herbicides like glyphosate and 2,4-D applied at this time will be translocated down into the roots more effectively than if applied in spring when nutrients are moving upward. This results in better control. In addition, the increasingly unpredictable spring weather patterns we have experienced in recent years can influence the timing and efficacy of spring burndown applications. Fall-applied herbicides can lead to weed free situations going into spring until early emerging annuals begin to appear in April, and are an essential component in the control of marestail and other overwintering species.

Here are some reminders when it comes to fall-applied herbicides:

  • Evaluate weed emergence and growth post-harvest to help determine if an application is necessary.
  • Fall-applied herbicides should primarily target weeds that are emerged at the time of application.
  • Species present in large quantities late-season that would necessitate the application of an herbicide include (but are not limited to): marestail, dandelion, wild carrot, poison hemlock, common chickweed, purple deadnettle, henbit, annual bluegrass, and cressleaf groundsel.
  • OSU research has not found much of a benefit from adding metribuzin or other residual products late in the fall. The exception to this is chlorimuron, which can persist into the spring. The recommendation here has generally been to keep costs low in the fall and save those products for spring when you will get more bang for your buck.
  • Herbicides generally work across a range of conditions, though activity can be slower as temperatures drop. Foliar products are most effective when daytime temperatures are in the 50s or higher and nighttime temperatures remain above 40.

Table 1 in the Weed Control Guide for Ohio, Indiana, Illinois, and Missouri provides ratings for various overwintering weed species in response to fall-applied herbicides.

Harvest Delays – Light vs. Temperature

There has been a lot of discussion about the crop yields from 2023 in Ohio, from early reports of crop stress in May and June to greater than anticipated yield values for many producers this fall. Yield reports of >110 bu/ac wheat harvested in July were reported in parts of Ohio, and better than anticipated yields in some corn and soybean fields. Harvest progress of corn has been delayed from normal for many farmers.

Many questions have been raised on the role that haze from Canadian wildfires may have played on seasonal crop growth this year. Ohio experienced three major episodes of wildfire impacts on June 6-7, June 27-29, and July 16-17, with several more days throughout the two-month period of less intense smoke-filled skies. However, looking at 2023 compared to historical trends overall radiation availability was similar to the 10-year historical average for the three CFAES research stations of Northwest, Wooster, and Western (Figure 1). Light availability was higher than normal in May through mid-June, in part due to many clear days and below average rainfall. Light availability approached normal levels throughout June and July in part due to a slight reduction during the short period of haze, but recovered to mimic the 10-year patterns observed in recent past.

Despite the short haze periods, the photons available per heat unit accumulated (PTQ or photothermal quotient) were at or above the 10-year average (0-38% greater) aside from July at Western research station (6% lower) and September at Northwest (2% below normal). Generally, greater PTQ values suggest that more photosynthesis can occur in the same thermal period and could lead to greater yields.

Figure 1. Daily light integral (left) and accumulated growing degree days, base 50°F (right), and the 10-year averages for three Ohio locations of Northwest Agricultural Research Station in Custar (upper row), Western Agricultural Research Station in South Charleston (middle row), and the Ohio Agricultural Research and Development Center in Wooster (bottom row) in 2023.

Contrastingly, accumulated Growing Degree Days (GDDs) were below the 10-year average for every location this year (Figure 2). The same pattern that brought the frequent spells of wildfire smoke, northerly wind flow out of Canada, kept temperatures below average for the summer (Figure 2 – left). It is possible the cooler temperatures helped crop’s periods of water deficit better this year than in years past, but also can have contributed to the slow drydown experienced by many farmers this year.

Interesting to note, several folks have commented that this summer reminded them of the summer of 1992. Looking at that year’s temperature difference compared to average (Figure 2 – right), temperatures were cooler in 1992 than this past summer. Mt. Pinatubo erupted in June 1991 and is often pointed to as a main reason for cooler global temperatures in the year that followed. Volcanic emissions circled around the globe high in the atmosphere throughout the tropical and sub-tropical regions, reflecting and absorbing solar radiation and cooling the Northern Hemisphere surface temperatures by about 0.9-1°F.

Overall, the cooler temperatures and slower accumulation of GDDs can be the largest contributor to delayed corn harvest this year. Cooler overall conditions could have led to slightly higher than normal PTQ values for the season, which also may help explain the higher than anticipated yields in the wheat crop this summer.

Fall-applied Herbicide Considerations

Harvest is progressing in much of Ohio, though recent rains have slowed field activities in some areas. As crops continue to come off it’s a good time for a reminder about the value of fall-applied herbicides. Rains this past week may stimulate winter annual weed emergence to some extent. This is the best time of year to control winter annuals and some of the more difficult to manage overwintering weed species. Biennial and perennial plants are now sending nutrients down to the root systems in preparation for winter. Systemic herbicides like glyphosate and 2,4-D applied at this time will be translocated down into the roots more effectively than if applied in spring when nutrients are moving upward. This results in better control. In addition, the increasingly unpredictable spring weather patterns we have experienced in recent years can influence the timing and efficacy of spring burndown applications. Fall-applied herbicides can lead to weed free situations going into spring until early emerging annuals begin to appear in April, and are an essential component in the control of marestail and other overwintering species.

Here are some reminders when it comes to fall-applied herbicides:

  • Evaluate weed emergence and growth post-harvest to help determine if an application is necessary.
  • Fall-applied herbicides should primarily target weeds that are emerged at the time of application.
  • Species present in large quantities late-season that would necessitate the application of an herbicide include (but are not limited to): marestail, dandelion, wild carrot, poison hemlock, common chickweed, purple deadnettle, henbit, annual bluegrass, and cressleaf groundsel.
  • OSU research has not found much of a benefit from adding metribuzin or other residual products late in the fall. The exception to this is chlorimuron, which can persist into the spring. The recommendation here has generally been to keep costs low in the fall and save those products for spring when you will get more bang for your buck.
  • Herbicides generally work across a range of conditions, though activity can be slower as temperatures drop. Foliar products are most effective when daytime temperatures are in the 50s or higher and nighttime temperatures remain above 40.

Table 1 in the Weed Control Guide for Ohio, Indiana, Illinois, and Missouri provides ratings for various overwintering weed species in response to fall-applied herbicides.

Fertilizer Prices Climb; and Injunction for Largest Proposed Fertilizer Mine in Brazil Overturned

Source: Farmdoc, University of Illinois

DTN Farm Business Editor Katie Micik Dehlinger reported yesterday that, “The retail prices of all eight major fertilizers climbed higher in the second week of October, with anhydrous, MAP and UAN32 posting the largest gains.

“DTN polls retail  fertilizer sellers each week to compile price estimates and considers a price change of 5% or more to be significant.

“Anhydrous prices climbed 16% on average to $804 per ton. MAP and UAN32 each climbed by 7% to $794/ton and $418/ton, respectively.”

Dehlinger explained that, “The prices of the remaining five fertilizers were all higher than last month, but less significantly. DAP cost an average of $711/ton; potash, $506/ton; urea, $575; 10-34-0, $613/ton; and UAN28, $356/ton.”

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