The following quotations for May and July as indicated were posted by the CME at close of trading on Friday April 12th together with values for the previous week in parentheses. Last week the commodities market showed a rise in the futures prices of corn, soybeans and soybean meal for May and July. This was attributed to intimations from the White House regarding a possible settlement of the trade dispute with China. Premature optimism apparently offset the negative effect of the release of the USDA Grain Stocks Report on Friday March 29th documenting soybean stocks. The absence of any definitive news resulted in a mild decline in prices from levels attained last week.



Corn (cents per bushel)

May 361 (362)

July 369 (370)

Soybeans (cents per bushel)

May 895 (899)

July 909 (912)

Soybean meal ($ per ton)

May 308 (308)

July 312 (310)

Changes in the price of corn, soybeans and soybean meal this past week were:-


Corn: May quotation down 1 cents per Bu        (-0.3 percent)

Soybeans: May quotation down 4 cents per Bu (-0.4 percent)

Soybean Meal: May quotation unchanged         (-)

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.40 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight


The March 29th USDA Grain Stocks Report, issued Quarterly confirmed a 3.2 percent decline in corn stocks in all positions to 8.60 billion Bu. compared to the March 2018 report. Farm storage represented 59.6 percent of this total, 2.5 percent higher than for the corresponding period in 2018.

Soybean stocks increased by 28.7 percent from March 2018 to 2.716 billion Bu. in March 2019. On- farm storage attained 1.270 billion Bu. representing 46.7 percent of all stocks. On-farm storage was 48.5 percent higher in March 2019 compared to 2018 reflecting the intent of farmers to hold stocks in anticipation of a rise in price following resumption of exports to China.

There is moderate optimism concerning the outcome of the ongoing negotiations between China and the U.S. An extension of the March 31 st deadline to raise tariffs from ten percent to twenty-five percent on over $200 billion in annual imports from China is now a reality. In return China has agreed to purchase an unspecified quantity of agricultural commodities in addition to energy and heavy equipment from the U.S. to offset the negative balance of payments.

Shipments of soybeans to China resumed in January but at a far lower level for the first two months of 2019 than in 2018 before initiation of the trade conflict. (see report and graphics in the March 27th edition of CHICK-NEWS by entering 'China' in the SEARCH block). China has hinted at a six-year purchase commitment probably due to concern over continuity of supply from Brazil due to uncertainties over drought and deficiencies in inland transport.

Negotiations with China are apparently making progress as denoted by shuttles between Beijing and Washington that will continue this week but without any disclosure of specifics. Some concessions have been made by China on coercive trade practices. And dispute resolution. From an agricultural perspective the question of delays by China in approving new GM cultivars has yet to be settled. No date has been set for a summit to sign a trade deal. Markets are now cautiously responding to conflicting reports from the Administration but prices will be influenced subsequently by current stock levels, area to be planted and early crop progress in the face of possible flooding.

The March 28th USDA projection of plantings based on farmers' intentions suggest that an additional 3.66 million acres will be planted to corn compared to 2018.This increase will be offset by a reduction in soy acreage by 4.58 million acres.

According to the April 9th 2018 WASDE Report #587, 81.7 million acres of corn will be harvested in 2019 to produce 14.42 Billion bushels. The soybean crop is projected to attain 4.54 Billion bushels from 88.1 million acres harvested. The levels of production for the two commodities are based on preliminary pre-planting projections of yield and acreage. Ending stocks were revised based on anticipated domestic use and exports.

See the WASDE posting summarizing the March 8th USDA-WASDE Report #587 under the STATISTICS tab documenting price projections and quantities of commodities to be produced, used and exported from the 2019 harvest.

Unless shipments of corn and soybeans to China resume in volume, as anticipated, the financial future for row-crop farmers appears bleak despite the release of two tranches amounting to $8 billion as "short-term" compensation for producers of commodities. Eligible soybean farmers received $1.61 per bushel. Corn farmers will not be placated by the promise of a year-round E-15 blend since the logistic problems of delivery to consumers and legal challenges will delay any positive price benefit. Oversupply of ethanol with the current 10 percent addition (read BTU dilution) mandate is evident from the April 12th spot price of $1.33 per gallon ($1.38 last week) that has not changed materially in ten weeks compared with a peak in late March 2018 at $1.60. Exports have been constrained by the retaliatory tariffs imposed by China on U.S. ethanol. Some refiners are reducing production and mothballing corn-fermentation plants. Corn farmers can be relieved that overly optimistic and unfounded projections of cellulosic ethanol to be available after 2017 have not materialized, based on technical complications and predicted financial infeasibility.

The loss inflicted on farmers by the trade war with China is a gain for livestock producers who will benefit from lower feed costs. It must be recognized that the hog and poultry industries have experienced higher costs for more than a decade as a result of the RFS, a gift that keeps on giving. The mandate is a boon to Midwest politicians, corn growers and ethanol refiners at the expense of anyone in the U.S. who eats or uses any form of transport.