Two factors continue to converge to push nearby corn and soybean basis sharply higher in the eastern Midwest, as the old crop marketing year enters its final quarter.
Production was down in Indiana and Ohio last year, causing old crop supplies to be tighter than normal headed into summer, a fact that would normally cause buyers to have to bid up prices. Compounding the situation this year is the slow start to planting and emergence that has many producers in the region gun-shy about letting go of remaining inventory. Farmers typically don't empty their bins until they're comfortable the new crop is off to a good start.
The Eastern Midwest basis averages tracked by Farm Futures are above normal for this time of year, with soybeans continuing to be red-hot in the cash market. Eastern basis is 20 cents or better over option price, on average. Corn is also above average, trading close to July futures from Toledo into Indiana.
To read Bryce Knorr's complete weekly basis review, click HERE.
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