Luke Swenson, president of The Money Farm, West Fargo, N.D., considered that recently as he and a colleague contemplated what it takes to actually make a good soybean crop?

“When we’re looking at how the U.S. is, historically, we love looking at three-foot-tall beans that are nice and bushy, but how often do we go in to combine those beans and we’re disappointed in the yield?” Swenson said. “And then we’ll go roll in with a flex head glued to the ground because we’ve got 8-inch-tall beans that somehow are yielding 50 (bushels per acre).

“I think that’s the scenario you’re going to see this year,” he continued. “No one up here is overly excited about the quality of beans yet. Nothing looks overly pretty in a lot of the Northern Plains. The central part of the Corn Belt looks a little better, it looks a little more average there. More used to normal.

“Here, we look below average, but that really hasn’t, historically, shown a huge correlation yield-wise,” he added. “When you come into 3-foot stalks up here and beans are all bushy, generally we aren’t getting the pods with it. So beans are still made in August. The question we think is: what do we actually still have for acres out there?”

Swenson said it’s well known there’s a lot of wheat in the region, as well as a decent amount of corn, but he still thinks that soybean acres could be pulled back a bit from what people are anticipating.

“Obviously, we saw that in the June acres report, as well, and that’s the main thing from a bullish standpoint. That’s what we’re keeping track of,” he said.

“If you have any sort of shortfall anywhere, I mean bean stocks, the (supply and demand) numbers are very tight going into next year. But, with rain hitting most of the dry spots recently, I’m not seeing lots of pictures of any big-cupped beans anywhere. We don’t see any concern in the near-term,” he added.

Swenson feels it’s going to be in mid- or late August before people are starting to show any concern one way or the other of what early August heat does to the crop.

Elsewhere, Swenson said there isn’t much news coming out of South America, although the currency there has been bouncing quite a bit. He did note that Brazil and Argentina are “playing friendly with the brick countries” because they need to get their fertilizer out of Russia this winter.

“It’s the one big thing, with the U.S. actually going soft on fertilizer imports right now,” he said. “I don’t see any scenario in which Brazil or Argentina are going to slow up their import structure.

We’re putting fertilizer on top of, in most cases, heavy, high quality ground. There, they’re planting three crops a year on top of beach sand, so they need fertilizer coming in.

“If they don’t have it, it’s going to get ugly, so their big concern is what their inter-currency play is doing,” he continued. “They’re going to barter back and forth. They're going to take some of these solid export prices and just go lock up more high priced fertilizer and keep rolling forward.”

The headlines from South America have been pretty quiet and, from a political standpoint, he doesn’t see anything changing in the near-term.

“You’re kind of in the dead season right now. It’s not anything eventful news-wise for the next month. They’re just sitting there getting ready for the next big season and waiting for us to get closer to harvest,” he said.

Looking at local bean prices, he noted that as of July 19, new crop bids were sitting at 60 cents under. Old crop bids are 30 under, which he says are strong historically on old crop.

“But you’re in a tight stock market, that’s kind of the way everything is going to trade out,” he said. “We’re not against taking some of this decent basis and going into harvest here at 60 (cents) under. That’s a good seasonal number. With a strong dollar, I don’t know if you want to get too crazy bullish on basis in the near-term.”

Looking at local prices at one local elevator in west central Minnesota regularly followed in this column, as of July 19, the August cash price for soybeans was $13.88 and basis was +30 cents over. The November 2022 futures price was listed at $13.58 and basis was at -22 cents under.