Good's comments came as he reviewed corn and soybean prices,
which have increased modestly from the marketing year lows of
mid- to late October.
The average cash price of corn in
central Illinois reached a low of $3.33 on Oct. 24, recovered to
$3.825 on Oct. 29 and stood at $3.645 on Oct. 31. The average
cash price of soybeans in the same area reached a low of $8.055
on Oct. 15, recovered to $9.09 on Oct. 29 and stood at $8.94 on
"The price of corn was 5 1/2 cents higher than on the same
date in 2007, while the price of soybeans was 79 cents lower,"
For the most part, prices of corn and soybeans have been
influenced by developments in the financial, energy and currency
markets, Good said.
"In addition, prices have received some direction from the
pace of exports and export sales," he said. "Corn exports and
export sales continue to be relatively weak. Total export
commitments -- shipments plus outstanding sales -- stood at 6.56
million bushels as of Oct. 23. Export inspections were very
small for each of the two latest reporting periods, ended on
"New sales need to average about 24 million bushels per week
in order for marketing year exports to reach the USDA projection
of 1.95 billion bushels. New sales for the last reporting week,
ended Oct. 23, were only 16 million bushels. Sales are running
40 percent behind the pace of a year ago, with sales to each of
the largest importers of U.S. corn lagging the pace of a year
ago. These importers include Japan, Taiwan, South Korea and
In contrast to corn export sales, sales of U.S. soybeans have
been large. As of Oct. 23, total export commitments stood at 524
million bushels, nearly 14 percent larger than sales of a year
ago. The USDA has projected a 12 percent year-over-year decline
"Export inspections were especially large in the two weeks
ended on Oct. 30," he said. "Sales of U.S. soybeans to China are
running nearly 16 percent above the pace of a year ago.
"While early export sales of U.S. soybeans have exceeded
expectations, a slowdown is likely to occur as the marketing
year progresses. The USDA has projected that, for the year,
China will import slightly fewer soybeans from all sources than
were imported last year."
Good added that prices of corn and soybeans have also
responded to changes in the prospective size of the 2008 U.S.
harvest. The USDA's revised acreage and production forecasts
released on Oct. 28 provided some modest support for prices.
Those revisions resulted in a 45-million-bushel reduction (1.5
percent) in the forecast size of the soybean harvest and a
167-million-bushel reduction (1.4 percent) in the forecast size
of the corn harvest.
[to top of second column]
"The USDA will release the final yield and production forecasts of
the season on Nov. 10," he said. "Any changes in that report should
be centered on yield forecast.
"The recent history of changes in soybean yield forecast from
October to November provides little guidance for expectations this
Over the past 10 years, the November U.S. average yield forecast
has been above the October forecast five times and below five times.
From 1979 through 1997, however, the November yield forecast
exceeded the October forecast 68 percent of the time.
"The season-ending crop condition ratings may also provide some
insight into expected change in the November yield forecast," he
noted. "At the end of the 2008 season, 57 percent of the crop was
rated good or excellent, suggesting a U.S. average yield of 42.7
bushels. That is 3.2 bushels above the October forecast.
"Over the past 35 years, however, the largest increase in the
soybean yield forecast in November was 1.4 bushels (1990)."
For corn, the November U.S. average yield forecast has exceeded
the October forecast in seven of the past 10 years.
"In fact, the November forecast has exceeded the October forecast
70 percent of the time since 1975," said Good. "The percent of the
U.S. corn crop rated good or excellent at the end of the season has
explained 88 percent of the annual variation in the U.S. average
trend-adjusted yield since 1986.
"This year, 64 percent of the crop was rated in good or excellent
condition at the end of the season, pointing to a U.S. average corn
yield of 154.4 bushels, 0.5 bushels above the October forecast."
[Text from file received from the
University of Illinois College of Agricultural, Consumer and