What is in this article?:
- Corn, soybean price collapse not expected
- Stiff competition for U.S. corn
• Current prospects point to some further weakness in corn and perhaps soybean prices, but a price collapse is not expected.
After the sharp decline this year, wheat prices look to be more stable in 2012.
Crop prices during 2011 were influenced by a wide range of factors that resulted in extremely large trading ranges, said University of Illinois agricultural economist Darrel Good.
“The price patterns, however, were very different for corn, soybeans, and wheat. As the year ends, thoughts turn to likely price levels in 2012,” he noted.
December 2011 corn futures started the year near $5.50, with the higher trend that began near $4 in July 2010 still in place. The trend continued, although erratically, reaching a peak near $7.80 in late August. Prices have declined sharply since then, with the December 2011 contract currently only about 30 cents higher than at the start of the year.
January 2012 soybean futures started the year just below $13, with the higher trend that began near $9.50 in July 2010 still in place. The price of that contract traded between $12.50 and $14.00 through mid-August, peaked at $14.74 in late August, and then plummeted to $11.00 in late November. That contract is currently trading near $11.40.
December 2011 wheat futures at Chicago were also trending higher at the start of the year. The higher trend started near $6 in July 2010, with the price near $8.50 in early January 2011. The price of that contract peaked near $9.70 in mid-February and is now just over $6, about where the price rally began in July 2010.
“For corn, it appears that 2012 will begin with a continuation of weak export demand. Although China has purchased 95 million bushels of U.S. corn and Mexico has bought more U.S. corn than a year ago, total sales are lagging the relatively slow pace needed to reach the USDA projection of 1.6 billion bushels for the marketing year,” he said.
For the four weeks ended Nov. 24, sales averaged 10.4 million bushels per week, compared to the average of 18 million needed.