USDA’s Crop Progress report Monday documented what weather-weary farmers have experienced with planters idled by wet, wet fields. Soybean planting is 17% behind a five-year average. But how long can delayed planting continue to hold soybean prices at their current levels?

Only 57% of soybeans were in the ground, USDA said, compared to a 74% average from 2008-2012. More than 90% of soybeans were planted by June 2, 2012. Still, after old- and new-crop soybean futures continued their rally with a 19.25¢/bu. to 22.50¢ jump in prices Monday, markets opened lower Tuesday.

November 2013 beans were off 15¢ at $13.10/bu. in early trades. July 2013 was down 4¢ at $15.28. The $15+ price for July and near $14.50 for August illustrate how soybean supplies remain tight, but not yet scarce enough to create major price swings, says Ed Usset, University of Minnesota Extension grain marketing specialist.

“Soybean prices have been remarkably stable since harvest, trading in a 10% range,” Usset says. “Prices are currently towards the high end of the range. At this point, hanging on to old crop or shying away from new-crop sales is a pure weather play – a bet that poor growing conditions will propel prices even higher.

“This, of course, is always a possibility. But I am ever reluctant to bet against the productive capabilities of the Corn Belt.”

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Tuesday morning all soybean futures prices were above the $12.87 Revenue Protection insurance. But how will summer weather impact prices? That annual question can have many answers.

“The inverse in the soybean and corn markets I wrote about two months ago still exists,” Usset says. “In Southern Minnesota, for example, the spot price of soybeans is $2.30/bu. higher than the new-crop bid.

“This price difference will evaporate over the next 75 days. The $64,000 question is whether new-crop bids rise to meet spot prices, or if spot prices collapse to new-crop levels. Holders of old-crop and reluctant new-crop sellers are betting on the former.

“But the more likely scenario is the latter.”

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