2023 Grain Markets Volatility
“More volatility and you know we're coming into a year where we have good weather your production numbers and supply could end up being rather large which is going to wreck this party that we've been having going on in production ag for the last three years and the grain side you know, on the same token, if the weather doesn't improve if we will stand another drought you know, it leaves the door open to another year of elevated prices. So our recommendation to producers out there is to establish some type of a floor that leaves the upside open but you know- yes, prices have fallen a lot in the last few weeks, there's a lot of room to go to the downside from here.”
As for input costs; “at least on the fertilizer side, which is the big one have been dropping, they're considerably cheaper than they were even just six months ago. At the same token I don't expect land rent or land prices to drop anytime soon. And so that's probably gonna you know, any drop on the inputs, like your chemical, your fertilizer might just end up getting shifted over to the land side.”
Schau says in this situation, the high prices have decreased demand as well as spring new fertilizer sources that have been imported into the US which has now caused oversupply for retailers.