Minnesota and the nation's farmers are expected to have large crops to harvest this fall and the big yields are driving grain prices down. After the U.S. agriculture department announced its first estimate of the fall harvest Friday, prices tumbled.
Soybean prices fell about five percent, corn was down nearly four percent. The expected good crops will add to the nation's grain surplus, lowering demand and prices for the commodities. The USDA estimates were larger than what grain traders expected, touching off the price tumble.
"We needed some positive input on at least one segment, whether it be corn, wheat or beans," said Tim Roth with Mastel Grain in Minneapolis. "And we got nothing, got no help whatsoever. And as a result people were very disappointed."
The U.S. soybean crop is estimated to be 4.6 billion bushels, four percent larger than last year's harvest. The nation's corn crop is estimated at 14.6 billion bushels, down less than one percent from last year. Minnesota farmers are expected to harvest about 380 million bushels of soybeans, about the same as last year. The state corn crop is down about 4.5 percent from 2017, at 1.4 billion bushels. The state soybean crop should yield about 49 bushels per acre, corn 191 bushels per acre.
The harvest news comes as farmers are trying to digest the ongoing trade disputes and their impact on farm commodities. China is a big concern. The Asian nation has placed a tariff on U.S. soybeans, raising their price for the Chinese market. Soybean prices have fallen about 20 percent since spring when the trade war heated up.
The only good news for markets may be that world corn and wheat supplies could shrink a little in the coming months, which may have a positive impact on prices.
"So I look for some better markets post-harvest," said Roth.
Still, world soybean stocks remain abundant.