This is the SFN Market Report with Brooks Schaffer of Palmetto Grain. Reach him at [email protected] or 843-540-4540.

Volume in the grain markets has been extremely low. It has the feel of a holiday market but there is no holiday. Harvest is over the hump in Brazil and getting rolling in Argentina with no major surprises so far. The second crop corn got planted timely and it is April weather that matters the most for production there. The funds have pulled a tremendous amount of capital out of the grain markets so the tariff headlines are not having as much of an effect on the ag space. Truthfully, I think all markets are growing a little numb to tariff headlines anyway since there is so much unknown. April 2nd is the stated date for a new round of tariffs but we have no idea what will actually go into effect. It is too early for US weather to matter yet so the market is just in a holding pattern until the report on Monday. 

Monday March 31st is the all important quarterly stocks and prospective planting report. The USDA outlook conference used 94 million acres of corn. The average estimate for Monday’s corn acreage number is 94.4 million which is 3.8 million acres higher than last year at 90.6. We are expecting soybeans to lose a lot of acres from last year. The market is expecting 83.8 million acres of soybeans compared to 87 million last year. Cotton is also expected to give up almost a million acres from 11.2 last year down to 10.2 this year. 

Some years, it is the stocks number that is the bigger surprise to the market. We have had tremendous demand this year for corn and soybeans and hope to see that reflected in this report. The market is looking for corn stocks to come in at 8.15 billion bushels compared to 8.35 million last year, 200 million less. Bean stocks are expected to be 1.9 billion bushels compared to 1.84 last year (only 60 million more). We have a pretty good idea of ethanol and export demand on corn since we get weekly reports, but feed demand can be a wild card. 

I will be glad to have this report behind us. Good, bad or ugly at least we will know and can start to plug that into balance sheets. After the market has taken such a big hit, it is going to take a really big corn acreage number to be bearish. But if we get a bigger number than expected, it also increases the marginal acres we bring into corn production and then we will start to call yield into question. We have a long planting and growing season ahead so even if the report is bearish, it does not mean we cannot rally this summer. The market is still going to have to trade weather and a weather market will bring fund money back in the market. Also keep in mind that if we get a really bearish number and the market drops, it will discourage some of those acres from being planted in corn and will lower the number we get in June.