May 26, 2004

Corn, Soybeans Finally Fetching Strong Prices In US

Strong grain prices in the US over the last few months have been a long time coming for Central Illinois farmers -- nearly seven years, to be exact.

In April, average corn prices peaked at $2.90 per bushel and average soybean prices hit $9.60, according to the Illinois Agricultural Statistics Service. A year earlier, those prices were $2.40 and $5.97, respectively.

But in the last month, July futures soybean prices have dropped $1.32 per bushel. July corn futures prices have declined 48 cents per bushel.

Darrel Good, University of Illinois Extension marketing guru, attributed the change to a slowing export pace and lower U.S. use for soybeans. Planting season has also been very favorable.

The corn situation appears less clear. The export forecast remains strong. U.S. Department of Agriculture officials expect a record crop again this year, but they also see record use.

Soybean prices are expected to drop even more unless usage increases, Good said. Corn prices should be a bit more buffered. Lower corn prices could be observed if the June 30 crop acreage report shows that planted acreage rose higher than March intentions, and growing conditions remain good.