American crops difficult to gauge

Variable weather conditions mean crop quality in U.S. Midwest is all over the map

U.S. analysts are scratching their heads about the true state of American crops.

Heavy rain has damaged but not destroyed crops across wide parts of the eastern corn belt and the winter wheat states.

There has been too much rain, but not so much as to leave easy answers about how much the crop has been damaged and how much yield potential still exists.

“There is severe uncertainty,” said analyst Rich Nelson of Allendale, Inc. of McHenry, Illinois.

“We have some big questions about this crop.”

The midwestern corn belt and the southern and northern Plains have had extreme differences in growing conditions.

Incessant rain in June and early July likely damaged the potential of corn, soft wheat and soybeans in the eastern corn belt, but the weather has been better lately. The winter wheat harvest has suffered from the rain, but it’s hard to determine the extent of the damage.

However, the situation couldn’t be better in many areas of the northern Plains and northwestern Midwest.

“In some places, I don’t know if it’s ever been better,” said Mike Krueger of The Money Farm, published in Fargo, North Dakota.

“The northern Plains, southern Minnesota, northern Iowa are probably the best there is.”

The situation deteriorates southeast of that region, but the heavy rain, while “way, way too wet,” is “not a disaster.”

Analysts say corn could face pollination problems if the wet conditions continue, and that period is what sets the yield potential. The soybean crop could be reduced by more than a million acres.

However, crops on the Great Plains and in the northwestern Midwest could balance some of that off.

“Our crop here (North Dakota) is awesome,” said Krueger.

Analyst Errol Anderson of Pro Market Communications said he is skeptical that the moisture problems in the corn belt will lead to a significantly smaller crop.

“I’m not much of a believer that flooded acres cut production. Yield (gains from rain) will trump acres (lost) always,” said Anderson.

That could produce another huge U.S. crop.

“It might be as big as last year, but it’s not far away. It’s going to be a large crop and we’re going to potentially have some large carryouts a year from now.”

On the other hand, Krueger thinks even slight reductions in overall U.S. production will have a bullish impact.

“If you take just two or three bushels off the corn yield from the last USDA number, and a bushel off the soybean yield, you’ve got things relatively tight again,” said Krueger.

“No one’s looking for a big drop in yields, but we don’t need a big drop.”

In the last U.S. Department of Agriculture monthly forecast, corn yield was estimated at 166.8 bushels per acre, producing a crop of 13.5 billion bu.

Soybean yield was forecast at 46 bu an acre, producing a crop of 3.89 billion bu.

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