Matt Campbell covered many of the moving parts of the grain markets on Friday’s AgriTalk After the Bell with Chip Flory.
After detailing today’s Brazilian corn crop estimate from Safras e` Mercado of just 79 million metric tons, Campbell added, “The balance sheet for corn really can’t handle any less supply or any more demand without changing the outlook for corn prices.”
When Flory asked him to dig deeper into that perspective, Campbell “backed off” a bit on the demand statement, saying, “We’ll always take more demand,” but he explained the expected 500-million-bushel year-to-year drop in U.S. corn ending stocks should have the corn market looking for more acres for the 2019 growing season.
Flory added, “We haven’t had a real reason for the corn, soybean, wheat, cotton and minor crops to battle for acres in the past four or five years… and an acreage battle always changes the dynamics of the markets.”
On the risk-management front, Campbell said he sees the potential for corn prices to work higher, but he still likes being a scale-up seller in corn futures. For soybeans – because of hefty beginning stocks for the 2018-19 marketing year – Campbell said growers should be a bit “more aggressive” on building downside price protection.