US corn, soybean futures hit highs on eroding yields

Soybean futures climbed to $14.54 on Aug. 29.

U.S. corn futures hit an 11-week high and soybeans reached their highest prices since February on continuing speculation of eroding yields due to continued drought, particularly in the Midwest, according to reports.
Corn futures for December delivery hit $7.79 on Aug. 29, the highest for the most-active contract since June 9. Prices are up 77% in the past year, including 15% in August. Soybean futures for November delivery reached $14.54 on Aug. 29, the highest for a most-active contract since Feb. 10. “The fear is that supply is falling faster than demand,” said Don Roose, the president of U.S. Commodities Inc. “Oppressive heat in July damaged crops, and now the dry weather is further reducing yields.”
The first two weeks of September call for less rain than normal from Nebraska to Indiana, leaving roughly one-third of the main growing areas in the Midwest too dry, according to Commodity Weather Group LLC.

Monsanto expects corn, soy to be profitable

Despite cutting nearly 2,000 employees, Reuters reports Monsanto is set to introduce its new corn and soybean products next year.
These lines are projected to provide a third of gross profits in three years and expects a launch on 10-12 million acres. The new products are Genuity SmartStax corn and Genuity Roundup Ready 2 Yield soybeans.
Further news that the company’s restructuring plan will provide significant cost cuts helped push Monsanto shares up 42 cents at $78.50 in pre-market trade on the New York Stock Exchange.

Temperature increases could impact US corn, soybean crops

An American research report to the National Academy of Sciences says predicted temperature increases due to climate change would have a huge impact on the corn and soybean crops in the U.S. Midwest.
At ambient temperatures up to 29 C for corn and 30 C for soybeans, yields would actually rise with a warmer climate. Above those levels, however, the effect on yields is likely to be devastating.
The calculations, reported in “Nonlinear temperature effects indicate severe damages to U.S. crop yields under climate change,” by Dr Michael Roberts of North Carolina State University and Dr Wolfram Schlenker at Columbia University, indicate a continuation of greenhouse gas emissions at current rates would cut US yields of maize, soybeans and cotton by 63-82%. Even if united action succeeded in cutting emissions down to 50% of 1991 levels by 2050, there would still be warming enough to reduce crop yields across the U.S. by between 30% and 46%.
The scientists emphasized they looked at crops in the U.S. alone. But since American farms have been producing more than 40% of all corn worldwide and 38% of soybeans, they continued, there would be implications for global grain supplies.

US gears up for largest-ever soy crop

Drought damage to South Africa's soybean crop, a key U.S. competitor in soybean exports, could benefit farmers in the U.S., journalgazette.net reported, quoting a grain analyst.
A U.S. Department of Agriculture report forecasts the largest soybean crop ever and the second-largest corn crop.
Jon Cavanaugh, marketing director for Central States Enterprises Inc., said that China is importing nearly 42 million metric tons of soybeans. It is expected to buy 60% of U.S. soybean exports.
Cavanaugh has reportedly predicted soybean prices to hover around $9.50 a bushel but added that demand could push prices to as high as $12 a bushel.

USDA lowers corn price estimate

The U.S. Department of Agriculture lowered its 2008-09 average corn price estimate to $3.55 to $4.25/bushel in a January 12 report, 10 cents below the previous month’s report.
The World Agricultural Supply and Demand Estimates (WASDE) place this year’s soybean prices at $8.50 to $9.50 per bushel compared with $8.25 to $9.75/bushel last month. Soybean meal prices are projected at $250 to $310 per short ton, up $10 on both ends of the range.
On wheat, the projected season-average farm price is narrowed 10 cents on both ends of the range to $6.50 to $6.90/bushel.
On coarse grains, USDA reduced feed and residual use by 50 million bushels, reflecting lower animal numbers and September-November disappearance as indicated by December 1 stocks.
In addition, the department lowered ethanol use by 100 million bushels as sustained negative ethanol production margins have reduced incentives for ethanol output. Looking at other crops, the sorghum season average farm price is lowered 10 cents to $2.90 to $3.50/bushel; barley narrowed 10 cents to $4.95 to $5.35/bushel; and oats raised 10 cents to $2.90 to $3.10.
The WASDE report reflects a lower meat production estimate from the previous month, with reduced 2009 broiler and pork production.
Beef production forecasts for 2009 are unchanged.