Some corn farmers are holding back stored corn from previous harvests instead of cashing in on higher prices so they can make good on the contracts they have with ethanol plants. Kathie Ostrander is a buyer for the plant near Lakota in north central Iowa.
She says farmers are being cautious because even though the crops in her area look pretty good, they won’t know for sure what they’ve got until it’s in the bin.
“People are still selling new crop corn, but they are selling a lot less increments. A person who would normally sell a 10,000 bushel increment is selling five, and it goes down from there. People who sell a thousand bushels are only selling 500, and that is because they are concerned about how many bushels they are going to get and they do not want to be short on their contract,” Ostrander explains.
She says the crops in her area look pretty good, but farmers know they can’t be sure until the corn is in the bin. “When we sell the corn, it’s going to be less bushels, due to the fact that everything is sold on weight anymore, a bushel is 56 pounds and if it does not weigh 56 pounds, it’s less volume,” Ostrander says.
The dry conditions lead to the lower test weight.