“Over the last five years, we’ve seen a 255 million to 315 million ton increase in global demand for soybean uses, and most of that has been in Asia,” Freed says. “The market is also concerned about whether we’re going to have enough corn production worldwide to satisfy demand over the next five years. In wheat, we had a couple of years when production rose above usage and prices went down. This year we’re expecting production to be below usage, and while growth in wheat demand for the next five years is not going to be as great as for corn and soybeans, there is still going to be demand for acreage planted to wheat.”There is “a lot of support” around the $5.50 price level for corn, he says, “and I don’t think the market will trade below that until we know more about acreages this year and weather patterns. Some people think that if we ratchet up ethanol demand it could take nearby corn futures to $7 — that if we want to buy acres, we need to take corn to $6.25.

“If we were going to change anything in the USDA estimates, we’d probably add another 100,000 bushels of corn for ethanol usage. Ethanol is here to stay, and that usage will continue higher.

“Things are really going to get tight for corn usage around Aug. 1, particularly if we have a late-planted crop. Corn ending stocks will remain low unless we just have a super crop. But looking all the way back to 1980, the number of days of world corn supply is now at a record low — we don’t have a lot of margin for error, whether from a weather standpoint or from a demand standpoint.”