It’s that time of the crop year and harvest when we start seeing just how much off farm storage space really exists……………………………..The race is still on to find a home for corn and beans and it just has to play out as its pretty difficult to hide a couple of hundred million bushels when all the bins are full………………………..Yet, after that last bushel is harvested and everything that’s on the ground moves before next Spring, things get tough to originate and basis levels climb……………………..
It still appears that we’re a “too cheap to sell yet, no urgency to buy” fluttering market looking for direction from southern hemisphere weather and/or outside markets and fresh trade deals and pacts………………………The events of first notice day against November beans, election day and then the November crop report are meaningful yet, harvest and seeding activity remain the most important market factor…………………………………………..and it appears that we can get a lot of work done in the next few days……………
The freshest figures that I can find have the covered hopper fleet near 400,000 rail cars, the covered barge fleet at 13,000, the Great Lake fleet near 100 and ocean going bulk carriers of all flags at 6225………………………………………So, off farm storage and on farm storage according to the most recent government figures is around 24.6 billion bushels and temporary moving storage with the pipeline/transportation might be around 1.5 billion bushels……………Is it enough to store and transport all the wheat, corn , soybeans, sorghum, rye, oats, sun seeds, edible beans, quinoa, spelt and rice produced and have a little space to maneuver????…………………………………..It appears to be tight and creative methods might be developed to alleviate the overcrowding………………………………………And, we have had years when even with field loss potential producers allow corn and beans to spend the winter un-harvested……………………………Only time will tell but until that time arrives it’s a buyer’s market and there’s no reason to push the basis………………….
The information contained on this site is the opinion of the writer and obtained from sources cited
within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.
Steve Bruce
Walsh Trading
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