Ontario Grain Farmer December 2023 / January 2024

Marketing

Blair Andrews

Market review 2022 - 2023 GRAIN PRICES FALL BUT REMAIN HIGH

WHILE THE CORN , soybean, and wheat prices for the 2022 - 23 crop marketing year retreated from the lofty highs of 2021 - 22, they were still well ahead of the previous five-year average. The significant market drivers included the outlook for a larger corn crop in the U.S., increased soybean production in Brazil and the war in Ukraine. CORN The average Chicago cash price in 2022 - 23 was $6.21, lower than the previous year’s average of $6.46 but $1.67 above the previous five-year average of $4.54. The highest closing price in Chicago was $6.98 on October 10, October 13, and November 1, 2022.

of $7.96 and higher than the previous five year average of $5.87.

corn destined for China weighed on the market, dropping the price to $5.55 on May 19. A weather rally helped the prices gain ground again as concerns over dry conditions lifted the prices over the next few weeks, reaching $6.71 on June 21. However, forecasts for much-needed rain and a surprising acreage report from the USDA knocked the closing price down to $4.89 on June 30. Corn prices tumbled as the USDA pegged the U.S. corn acreage at 94.1 million acres, up two million from the March estimate. SOYBEANS The average closing old crop soybean price in Chicago in 2022 - 23 was $14.22, down slightly from the previous year’s average of $14.56. The previous five-year average was $11.01. The highest closing price in Chicago was $15.44 on February 21, 2023. The average Chatham-Kent high cash price for 2022 - 23 was $19.08, up 47 cents from the 2021 - 22 average of $18.61 and well above the previous five-year average of $13.91. Concerns over hot and dry weather in Argentina buoyed soybean futures in the first two months of 2023. After peaking in February, the prices declined over the next few weeks amid economic worries fuelled by the U.S. banking crisis that caused three major lenders to collapse. Expectations for a record crop in Brazil applied further pressure, dropping the price below $14.00 on June 23. The nearby future prices struggled during May, losing more than $2.00 per bushel by the end of the month. A good planting pace in the U.S., weakness in the crude oil and equity markets, and a two-month extension of the deal to allow Ukraine to ship grain through the Black Sea corridor weighed on the prices.

The nearby corn future traded between $6.60 to $6.98 for most of the early part of the marketing year. The prices eased in February following the United States Department of Agriculture’s (USDA) annual Outlook Forum. The USDA estimated 2023 corn plantings at 91 million acres, up from 88.6 million the previous year. Production was forecast at 15.085 billion bushels, based on a record-high yield of 181.5 bushels per acre. After working their way back to $6.60, the corn futures suffered a setback in May. Favourable weather for planting and a series of cancellations by private exporters for U.S.

The average Chatham-Kent high cash price of $7.62 was lower than the 2021 - 22 average

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