Effingham Daily News
No one expected the near-normal soybean crop that persevered despite this summer's drought.
Illinois Soybean Association District 13 Director Gary Berg has heard the same thing at committee meetings and a commodity conference last week.
"Everyone is amazed and surprised what the soybeans did considering what they went through," said the St. Elmo farmer.
In a report released Monday by the University of Illinois, agricultural economist Darrel Good said that soybean futures continue to be high for soybean meal prices. Meanwhile, the prices for soybean oil have dropped back to the levels of early June.
"For the 2012-13 marketing year, the USDA expects soybean oil prices to remain weak relative to soybean meal prices," said Good in his report that focused primarily on the outlook of soybean oil. The oil is an important ingredient in the manufacturing of biodiesel fuels.
"With demand potentially stronger than currently projected, the increase in prices that began two weeks ago is likely to be extended," he said.
Good said that soybean futures are 13 percent above the early June level, while soybean meal prices are 21 percent higher.
But Berg said he believes those numbers still might come down. Although the harvested yields have not been totaled yet, they are better than expected thanks to late August rains that unfortunately came too late to help the devastated corn crop.
"Everybody is trying to guess. I'm not sure they came up with a real figure yet," said Berg of soybean yields.
Still, a majority of the state benefited, even though yields look to be less than normal.
"Yeah, we didn't have a normal crop, but it's pretty close," said Berg.
The drought drove a sharp increase in soybean prices beginning in June and peaking in early September.
"People who do trading hear there's no rain and start to speculate there's not going to be enough supply, and that starts to drive up prices," said Berg.
The late rains, however, pushed those speculations aside and eased prices.
"Soybean prices have dropped back substantially," said Berg.
While soybean crops aren't as good as they would have been under average weather conditions, Berg is relieved by the outlook.
"Thank goodness," he said.
Cathy Thoele can be reached at 217-347-7151 ext. 126 or firstname.lastname@example.org.