Analyzing the current soybean-to-corn price ratio
The USDA’s soybean-to-corn price ratio is above 2.5 indicating soybeans are relatively more profitable than corn right now.
Gary Schnitkey, a farm management professor at the University of Illinois, tells Brownfield with today’s low prices “profitability” just means less losses in this case.
“Reductions in ethanol keep corn prices low and there has been a bit more optimism on soybeans here lately because of exports to China.”
As harvest approaches, Schnitkey expects soybean prices to come back down. He thinks there is a little more optimism in the soybean market than is warranted.
“Corn prices might actually come up a bit as we come to terms with what happened in Iowa with the windstorm and see how bad the losses were there. We might get corn prices coming up and soybean prices coming down.”
He reminds farmers this is a new price environment and looking at soybean prices, this might be a good opportunity to make some sales.