Mid Week Comments
Big Crops Get Bigger??? - 8/04/20
The old saying is that big crops get bigger, and right now we don't have
an exceptionally big crop coming of corn and soybeans - but it is above
average, and growing each week. This week we have another slight
improvement in corn of 0.5 bu/acre, and in soybeans of 0.12 bu/acre.
These are small changes, but they are getting bigger, not smaller, as the
year rolls on. Its August now, with only soybeans having significant
weather left to influence the crop in the development stage, and then
harvest in the corn belt (with so much tiled ground) becomes an easier
prospect. So harvest losses are usually minimal.
Weather forecasts the next 14 days have turned warmer and drier for the
western US, and still remain cooler the next 7 days in the eastern US,
but then warms in the 8-14 day forecast back to above normal. The
eastern US also is forecast to have above normal precip in the 8-14 day
forecast, but very little precip in the next 7 days in the corn belt.
The east coast is getting heavy rain from the Hurricane that hit land
last night in NC, and is moving north mostly and eastward eventually but
will hit most of the east coast with heavy rain before its done.
Overall, weather still is mostly favorable for crops, although there
always is some area that's too dry (IA and northern IND/OH) and too wet
(ND). Harvest has begun for HRS wheat and barley, and overall those
yields look to be fairly decent as well.
Crop conditions out yesterday afternoon 8/3 show a continued improvement
in yield potential of corn and soybeans, and probably most other crops.
Corn conditions were unchanged at 72% G/E, with the yield model going up
0.5 bu/acre to 181.16 bu (above USDA's current 178.5 estimate). Soybean
conditions improved 1% to 73% G/E, and the yield model jumped 0.12
bu/acre to 50.63 bu, also above USDA's 49.8 bu/acre estimate. Its likely
USDA will hike yields in the August report as the crop is doing quite
well in spite of below normal precip in many areas, and well above normal
temps most of the summer. Crop development is also ahead of normal in
both soybeans (59% setting pods vs. 54% average) and corn (39% dough vs.
Cotton is about the only crop falling back, with a 4% drop in conditions
to 45% G/E vs. 54% last year, so cotton will be below average this year
which is why cotton prices are going higher. Sorghum conditions improved
2% to 55% G/E, HRS +3% to 73% G/E, and barley +1% to 81% G/E; but all of
these crops are behind normal development due to the late start in these
areas. Winter wheat is 85% harvested (-3% from average) while HRS wheat
is 5% harvested (5% behind normal), and barley 5% harvested (7% behind
normal). For most spring planted crops, though, the prognosis is for a
decent crop, maybe even above average and in some areas, record large
yields are possible.
Soil moisture levels are maintaining at 64% adequate/surplus topsoil
(+1%), and 65% adequate/surplus subsoil (unchanged), which means we will
probably get by this year despite warmer and drier than normal conditions
in many locations - and still produce an above average crop.
While 'rain makes grain' and "Big crops get bigger", typically higher
yields mean more depressed prices into harvest. But so far, the past few
weeks have included improvements in weather for crop development - but
prices are really not seeing any serious deterioration in soybeans yet,
but corn is right back down at the yearly lows. It makes one wonder, how
much lower can it go???
Ray can be reached at email@example.com.
Ray is President of Progressive Ag Marketing, Inc., a top Ranked
marketing firm in the country. See http://www.progressiveag.com for
rankings and link to data from Top Producer Magazine and Agweb.com.
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