USDA Reports and Comparison Charts - Wednesday, 31 May 2017

There has already been lots of information out of the USDA this week for the markets to sift through.  Yesterday we received the weekly planting progress report as well as the first of the season corn conditions report.  The planting progress report this week indicated that as of Sunday 91% of the nation’s corn is now planted (it is unclear whether or not this includes acres that still need to be replanted or not). 

Notable states running behind normal pace:

  • Wisconsin 77% planted -7% behind normal
  • Indiana 81% planted -9% behind normal
  • Ohio 82% planted -6% behind normal
  • Illinois 93% planted 3% behind normal

Notable states running ahead of normal pace:

  • Iowa 97% planted +1% ahead of normal
  • Minnesota 96% planted +2% ahead of normal
  • South Dakota 95% planted +1% ahead of normal
  • North Dakota 94% planted +6% ahead of normal

The first of the season Crop Conditions report for corn showed the 65% of the U.S. corn crop is in Good to Excellent condition, this number is well below last year’s initial rating of 72% and also below the 5 year average of 71%.  One significant point in this report is that some of the nation’s bigger producing states like:  Illinois, Indiana, Missouri, North Dakota and Wisconsin are all around -20 points below last year.  Another important point to consider is that Indiana, Illinois, Ohio and Kansas all have double digit figures in the Poor to Very Poor category.

Notable states comparing last year’s rating to this year:

  • Iowa 73% GD/EX last year 77%
  • Minnesota 68% GD/EX last year 71%
  • Wisconsin 61% GD/EX last year 85%
  • Illinois 52% GD/EX last year 71%
  • Ohio 49% GD/EX last year 63%
  • Indiana 43% GD/EX last year 69%

There is a lot of conversation regarding the condition of the nation’s corn crop and how that may correlate in yield outcomes.  While all of this is important information to monitor, remember that there are a lot of factors that will influence the final outcome between now and harvest.  The chart below from The Van Trump Report gives us a year-by-year comparison for the past 14 growing seasons. 

Year    Acres Planted    1st Condition Rating      Final Yield 

2003     78.6 million          68% GD/EX                    142.1 new record

2004     80.9 million          68% GD/EX                    160.3 new record

2005     81.8 million          64% GD/EX                    148.0

2006     78.3 million          71% GD/EX                    149.1

2007     93.5 million          78% GD/EX                    150.7

2008     86.0 million          63% GD/EX                    153.3

2009     86.4 million          70% GD/EX                    164.4 new record

2010     88.2 million          76% GD/EX                    152.6

2011     91.9 million          67% GD/EX                    146.8

2012     92.3 million          72% GD/EX                    123.1 recent low

2013     95.4 million          63% GD/EX                    158.1

2014     90.6 million          76% GD/EX                    171.0 new record 

2015     88.0 million          74% GD/EX                    168.4

2016     94.0 million          72% GD/EX                    174.6 new record

The old saying of “rain makes grain” has weighed on prices as most areas have received plenty and there is no shortage in sight.  Corn has remained in its narrow trading range but soybeans had a very poor technical showing last week as they broke through the bottom of their trading range. Prices are getting close to breaking through $9.00/bushel, the last time we had prices at this level was in March of 2016.  At this time the Funds are short -165,000 corn contracts, -85,000 soybean contracts and -117,000 wheat contracts.  Sizable losses are being posted in both the corn and soybean complex’s today due in part to a drier pattern setting up in the Eastern Corn Belt that should allow producers to get back into their fields to plant again, some for the first time and some for the second and third time this season.  Other headlines driving market prices:

  • Producers in South Africa are expecting to harvest a record corn crop this year.
  • Cattle placements for the month of April were a record size.
  • Barges traffic is slowed due to high water.
  • Analysts are predicting a U.S. corn yield of 169 bushels per acre this year.
  • The U.S. soybean yield is estimated at 49 bushels per acre this year.

Some 67% of the 90 million U.S. soybean acres are now planted. 

Notable states:

  • Wisconsin 45% planted -21% behind normal
  • Indiana & Ohio 54% planted -17% behind normal
  • Illinois 62% planted -9% behind normal
  • North Dakota 83% planted +16% ahead of normal
  • Minnesota 81% planted +5% ahead of normal
  • Iowa 77% planted and running right on pace

 

Agrimoney reported that farmers in Saskatchewan will be leaving 1.7 million acres unplanted this season.  Saskatchewan is one of Canada’s top growing regions but excessive rainfall will prevent approximately 5% of the province’s farm ground from being seeded.  Some of the crop that had been planted is now needing to be replanted as well due to the hard frost that damaged some of the alfalfa, winter cereal and canola fields.

According to Weather Trends 360 the El Niño that had flared up a bit earlier this year has decreased slightly due to a Kelvin Wave moving across the Pacific Ocean.  This wave will again begin to “bake” under the very strong sun once it passes the Equatorial Oceans.  Currently the ocean temperatures are a bit cooler than a year ago, it’s quite likely we are still headed towards an El Niño pattern but it should remain weaker this year. According to Weather Trends “If you like colder winters in the Eastern U.S., you’ll like our winter 2017-18 forecast as the oceanic cycles, sun and a ton of statistics all line up for a big change from the past couple winter.” An article in AgWeek discussed the subject as well and agrees that there are now signs of El Niño this coming winter, if conditions do switch back to another El Niño next winter it will be what is known as a Modoki El Niño.  Predicting winter weather in the Northern Plains can be complicated during this pattern and a mild winter is not guaranteed in this scenario.  The last time Fargo, ND reported temps in January of -30 was in 2010 during another Modoki El Niño.

Rainfall amounts over the weekend were not as heavy as anticipated in key growing areas and a small window of opportunity is emerging for producers in these areas to possibly finish fieldwork. Reports from eastern regions of the Corn Belt that many acres that had been planted have sustained excessive rainfall resulting in many acres being replanted some for the second time.

June temperature outlook from The Weather Channel.

PLANTING PROGRESS

 

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