Posted: November 1, 2016
On 10/12/16, NASS updated their dry bean crop report. The good news is that DRK acreage dropped almost 5,000 acres to 60,460 acres with projected production at 1,262,408 cwt. If you remember the August Market Report, I discussed a 500,000 cwt carryover from 2015 crop and I don’t believe that number has changed. One of our buyers recently said he heard there were 1 million bags carried over to which I immediately said “Can’t Be!” This may be the case at times with navy, pinto or blacks, but it’s just not possible in kidney beans because processors don’t have the storage capacity to store a million bags and still have room for the 2016 crop.
What can we expect from the global market? Our source in China indicated that their DRK plantings were reduced for 2016. That’s good news; if global demand stays the same, the US will have a chance to export additional beans hopefully reducing the carryover going into 2017 crop.
Light red kidney projections reduced slightly from the August crop report with NASS dropping 1350 acres off the total. The 2015 carryover is still estimated over 350,000 cwt. Combining that with the good LRK yields of 2016 production should balance supply and demand.
Our current prices are unchanged, $34.50 - $35 on DRK and $33.50 - $34 on LRK.
Is there a bright spot for 2017? Only if we carefully balance the LRK & DRK acres with competing crops such as corn & soybeans. It’s tempting to over plant one commodity when everything else is in the tank. Specialty crop acres can be easily over produced especially if we perceive a little more value for them versus commodity crops.