As farmers flip the calendar over to January, they may be turning to new realities regarding grain markets as well.
"All eyes are focused on the big competition (from South America)," explains Don Roose, president of U.S. Commodities in West Des Moines.
While U.S. soybean supplies remain relatively tight, oilseed production in the rest of the world has been good this past year, and the outlook for a large crop in South America is strong.
Traders are keeping a close eye on that South American crop and so far the weather outlook there is good with cooler and wetter weather helping things.
South American production is just as important, if not more important, than North American production.
Another negative factor for the market is the cancellation of some contracts by China.
Contracts for almost 600,000 metric tons of corn have been canceled, and contracts for 2,000 metric tons of dried distillers grains also have been canceled. That is a negative drag on the market.
There is also much speculation U.S. farmers, who have been slow to sell 2013 corn and beans, may turn the switch and begin selling grain after Jan. 1.
Some farmers have been waiting for better prices while others may have been waiting until after the first of the year to sell for tax reasons. Whatever the reason, an increase in farmer sales would further depress the market.
