Green Report Maps and Weekly vs Monthly Reports - Friday, 18 August 2017

The USDA delivered a bearish report last week to both corn and soybeans.  The agency raised soybean yield estimates to 49.4 bushels per acre and are expecting a record production year with current estimates up +2% over last year’s record yield .  Corn estimates fell slightly from 170.7 bushels per acre to 169.5 but still above trade estimates.  The corn estimate is only -2.9% less than the record last year, this would make 2017 the third largest yield and crop ever produced! The trade had expected the USDA to report estimated corn yields between 164 to 166 bushels per acre which would potentially drop ending stocks to somewhere between 1.7 and 1.9 billion bushels given current usage levels.  Ending stocks at this level would likely not greatly impact markets this year or the following year but any kind of production issues could lead to a rationing scenario in 2019, according to Kevin Van Trump of the Van Trump Report. The annual Pro Farmer Crop Tour begins next week, daily and final results will certainly be watched closely to see if results from the tour help support the recent USDA yield estimates or adds more fuel to the yield controversy. 

Van Trump cautioned his readers that while many producers regard the weekly crop conditions report as accurate, it actually is based solely on the opinions of agents from local country FSA offices and other sources.  “These weekly condition estimates are simply opinions collected from county FSA agents and a few other sources, but have no real correlation to what NASS delivers the trade on a monthly basis in the form of a direct yield adjustment. All I’m saying is be careful getting worked up over these weekly condition estimates.  NASS has spoken to our office directly and told us these are just weekly “opinions” that are submitted by the FSA and a mix of other contributors.”

Soybean conditions fell 1% from 60% Good to Excellent to 59% this week just a few days after the USDA raised their yield estimate for 2017 from 48.00 to 49.4 bushels per acre. As I mentioned before though the trade prefers to follow the monthly USDA reports that base their numbers from several sources including: farmer surveys and more science and research based data from satellite imagery and field samples. There is already some debate circulating about new crop acreage and much of the conversation is based on acres in the Upper Plains.  It’s in this area of the country where a shift from row crops to wheat is expected.  The recent rally in wheat prices and the ability of wheat to tolerate weather conditions typically found in this region are both motivating factors in the likely switch.  If this switch occurs as predicted it will likely impact the balance sheets for soybeans in the U.S.

The weather has brought timely and beneficial rainfall this week for corn and soybeans especially in western sections of the U.S.  Several dry areas in Iowa have missed recent rainfall and continue to be a concern while some areas in Nebraska have received too much rainfall and are now seeing localized flooding as a result.

Below are the Green Report maps from Kansas Applied Remote Sensing (KARS).  Vegetation greenness from early August looks quite average (map 3) when compared to August of 2016 the areas of dryness and poor conditions of 2017 become much more evident especially in the central and northern Plains and western Corn Belt (map 2).


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