Lower crop prices are expected to continue until a production shortage in the U.S. or other major producing region occurs, according to a University of Illinois report.
Agricultural economist Darrell Good says corn prices remain pressured by three consecutive large crops in the U.S. and expectations of a third consecutive large coarse grain crop outside the U.S. He expects corn prices to average about $3.65 during the current marketing year and $3.85 for 2016-17.
Record large soybean crops in the U.S. and South America in 2014 and 2015 combined with an expected record South American crop in 2016 continue to weigh on prices. Good predicts prices may average $8.90 for the current year and stay in that narrow range for the 2016-2017 marketing year.
Three consecutive large wheat crops outside of the U.S. are limiting U.S. exports and building ending stocks. Good says 2015 wheat prices are likely to be less than $4 because of poor quality. He expects 2016 prices to average $4.75.
The report also looked at livestock prices. Good says increases in pork production and exports are expected next year and predicts an average of $50 for hogs in 2015, dropping to $48 next year. Good says beef production and exports are also expected to increase. Fed cattle prices in 2015 are projected at $149 and $135 in 2016.
The full report can be found here.