Nov 16, 2023

CoBank: grain storage outlook improves

Posted Nov 16, 2023 4:15 PM

The profit outlook for U.S. grain elevators storing corn and soybeans has improved significantly for the 2023-2024 marketing year with buy basis falling and carries returning to the futures markets.

The world market is currently awash in grains, and CoBank says global supplies of corn and soybeans are abundant. The current challenge for grain elevators is simply getting ownership of bushels. Farmers have been reluctant to sell as corn and soybean prices are down sharply from their peaks early in the year.

A new report from CoBank says the challenge of getting bushels should begin slowing in early 2024. The rising cost environment will likely compel farmers to begin selling in January, February, and March 2024 to generate cash ahead of next spring’s planting and operating expenses. “Higher land rents and borrowing costs combined with rising input prices will likely compel farmers to sell in 2024,” says Tanner Ehmke of CoBank.