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Record-shattering Yields Expected
Crop conditions improved 1% yesterday in soybeans to 71% G/E, with this now the highest rated soybean crop in 29 years of crop ratings! The soybean yield model expanded a large 0.84 bu/acre to 46.59 bu/acre, now a record shattering yield!
Soybeans will push to new lows with this news, and are probably in for a large loss day. Corn conditions dropped 1% to 72% G/E, still the highest rated crop since 2004 - the last time we shattered the record-large yield. Corn Pro Ag yield models are up 1.12 bu/acre to 171.6 bu/acre, so we are still adding bushels to an already large crop. Prices of corn reversed lower yesterday, forming a downside reversal and making last week's upside reversal look less meaningful, or maybe even a false signal. Based on the highest yield model of the year, Pro Ag expects corn futures to fall to new lows, as well they should. 2014 looks to be a record-shattering yield for producers of corn and soybeans.
Other crops also look good, with HRS wheat rated 68% G/E (down 2%), but with 17% of the crop harvested (vs. 33% normally), it looks like we will have record or near-record large yields of HRS wheat as well in spite of a late planted year. Barley lost 3% rating points to 62% G/E, but barley harvest at 31% complete indicates a record-large yield in most of North Dakota, with the northwest yields somewhat disappointing.
Corn and soybean progress is advancing, with 70% of the corn in the dough stage (vs. 63% normally) and 22% dented (vs. 27% normally). Soybeans are 95% blooming (at normal levels) and 83% setting pods (vs. 79% normally). Cotton conditions were at 50% rated G/E, down 2% points from last week and vs. 46% last year at this time. Cotton progress is exactly at normal with 88% setting bolls and 12% bolls opening. Overall, it looks like a very good crop in 2014, with corn and soybeans likely to shatter previous record-large yields. Even the Pro Farmer tour should see the large yield potential of the 2014 crop!
Pro Farmer's first tour day found an Ohio crop of 182.1 bu/acre (vs. 172 in 2013 and a three-year average of 146 bu/acre), with South Dakota at 153 bu/acre (vs. 162 last year and 126 average the past three years). Both numbers are well above USDA. Bean pod counts were 1,058 in South Dakota (vs. 1,017 last year and a 903 three-year average) and 1,342 in Ohio (vs. 1,284 in 2013 and 1,191 three-year average). Although Pro Farmer's record at predicting yields is sparse at best, it does reinforce the Pro Ag yield models, which are showing 2014 to be a record-shattering yield year.
Weather includes scattered rain across the Corn Belt today including Michigan, Missouri, Kansas, Oklahoma, and Texas, with more rain forecast for the northern, central, and eastern Corn Belt the next seven days including .5-1.5", locally 2-3" rains that will keep yield potential high for all crops. The temps will be above average - perfect weather to maintain high yield potential into the harvest. The eight- to 14-day forecast continues with above-normal precip and normal to below normal temps for all of the Corn Belt. This truly has been outstanding summer weather for producing maximum crop yields in 2014!
Prevent-plant acres were announced by USDA Friday, with 1.54 million acres of corn, .827 million soybeans, and 1.4 million acres of wheat. That is supporting corn prices Friday and today. But that might be a mistake, as planted acreage might not change much as this is less than half the PP of last year. Most of the PP is in North Dakota and Minnesota.
We have rehedged all grains recently, selling soybeans again as the yield models were not declining (and in fact were still rising slowly). So Pro Ag remains 100% hedged in grains as the trend is down, and we are going to have record-large yields of grains in 2014. Corn and soybeans both will set record-large yields this year as weather has been nearly ideal to date, especially during pollination of corn and early bloom of soybeans.
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