Grain markets surprised in 2022
With the late planting in 2022, many thought this may be a bad year for the grain markets. However two grain marketing experts were pleasantly surprised by an average year.
FARGO, N.D. — As the region heads into the last month of 2022, it has been an interesting year for the grain markets. At least that’s what grain marketing experts Randy Martinson and Frayne Olson think.
Heading into the spring of 2022, many were concerned about planted acreage, or possible lack thereof, due to the persistent rains. Low yields also weighed heavily on producers' minds.
“Obviously the crop turned out to be a lot better than we anticipated. Harvest went a lot smoother than anybody expected, especially here in the northern Plains,” Olson, North Dakota State University Extension crops economist and marketing specialist, said.
When looking at the total production numbers for the year, Olson said it came out to be an average year for grain, a pleasant surprise compared to what was expected of the crops in the spring months.
Martinson said that he was surprised that a typical harvest was possible this year due to the late planting and that the crop turned out to be average.
“For the most part, it was a much better end to the year than we were expecting,” he said.
One of the leading driving factors that impacted the grain markets during 2022 was Russia invading Ukraine. The market was impacted greatly due to the event in February, as it was unknown if either country would be able to get their grain out and exported, specifically wheat. Later on in the year, production issues arose in Australia. Heavy rains plagued the country and greatly affected the quality of their grains, which could possibly open the door for U.S. wheat exports according to both Martinson and Olson, especially in south asian countries that are more sensitive to quality.China not importing as much crops from the U.S., soybeans or corn, added to the trouble within the U.S. market and is still being seen with slower corn exports to China.
As for the grain markets current status, both Olson and Martinson are pleased with the standings.
“We’re sitting in a pretty decent state,” Martinson said. “One thing is we do know the market is going to be very reactive to any kind of special news or event that happens, like that missile strike in Poland that shot the markets up right away. So I think that’s something that the market is very sensitive to because of our tight stocks.”
As producers begin to make their planting decisions for the spring of 2023, there are some things to consider. Martinson believes that corn and soybeans will be the market drivers for the year, while wheat may take a back seat.
As for Olson, he thinks that the market will need to find the right balance between corn, soybeans and wheat. He also stated that it could be an interesting year for winter wheat.
“As we get into the spring planting period and we get into a little bit more of what that winter what crop looks like with that drought across the U.S., it’s really looking like this is the market trying to find the right balance of acres,” Olson said.