You are here

What crop disaster?-Ray Grabanski

The past 10 days have been a huge turnaround for the eastern Corn Belt in planting conditions.  They went from virtually nothing planted in OH (only 19% of the corn to May 30) to a much improved outlook for production in the region.  

Basically, they have planted about 45% of their entire land area in the past 10 days, effectively averting what was a potential disaster in the making.  Indeed, more was planted in the eastern Corn Belt the past 10 days than was done in all of April and May - an astounding feat and turnaround for the year. Ten days ago, we could have had $9 corn for the first time in history if the established weather pattern continued for the eastern Corn Belt and northern Plains.  

Instead, a relatively dry period for about 10 days to two weeks emerged which allowed soggy soils to dry out in most areas, allowing at least some or in some cases nearly all of the acreage in an area to be planted.

What a huge turnaround the past 10 days that weather has caused!  Now, with warming weather and improving crop conditions, not only is an average crop possible, but it still is possible for an above average corn and soybean crop to be produced in 2011.  The second week that corn crop conditions are released, the Pro Ag yield model for corn has risen to near 160 bushel, now about 1 bushel above current USDA projections.  Crop conditions improved from last week's ratings a large 4% in the good/excellent category to 67%, getting closer to the long term average ratings.  

Remember, USDA is projecting corn yields 2 bu below trend at 158.7; but the first Pro Ag yield model of the year is suggesting a yield closer to 160, which is bearish corn based on the improving crop yield potential.  It might be that the shot of heat this week combined with high soil moisture is improving the crop condition and yield potential.  We just might have a good corn crop after all and in spite of the terrible spring planting conditions experienced.  One thing about excessive moisture vs. lack of moisture, the germination is usually good if the crop doesn't stand in water, and this spring's cool temps and frequent rains have led to pretty good stands across the Corn Belt.  That might serve to pressure corn once we can finally ensure we actually got the crop planted.  

While the Corn Belt yield prospects have improved on planted crops, and also it looks like more acreage will get planted to corn in the eastern Corn Belt (or has already been planted), things are looking up for corn production prospects in the US over the last 10 days.  Not only are corn crop conditions improving, but winter wheat conditions have also slowly improved or stayed steady the past few weeks (when normally they decline due to the dying off effect).  This has meant the US winter wheat crop is turning out better than expected. Just 10-15 days ago, heat, that was abated for the past month, allowed what little moisture there was in the HRW wheat area to fill grain heads well.  Test weights of harvested wheat thus far are heavy (60-62 lbs), indicating the crop that was there got a chance to fill out nicely to finish off the year.  

While the western HRW Wheat Belt of the TX/OK Panhandle was devastated by the early spring drought, the rest of the winter wheat produced a pretty decent crop due to decent-to-plentiful moisture elsewhere and moderate temperatures. It's the same weather that kept Corn Belt soils from drying.  The moderate to cool temperatures are just what wheat likes to finish out kernels/heads, and allows wheat to reach maximum yield potential given a particular stand (which is determined by early season weather).  The winter wheat crop is thus not that bad, and is surprising a lot of people in how well it is yielding from limited moisture.  So perhaps the winter wheat crop isn't such a bust after all?

While much was made of the dry weather in Europe early this spring (a very dry April and early May), recent rains and cooler weather in Germany and France have abated their early season drought concerns, and improved prospects for spring planted crops in that region.  Overall, the last 10 days have resulted in a paramount shift in world crop production prospects for 2011, and it could be shown in the market reaction as well.

While 2011 will go down as a virtual disaster for spring planting in the northern Plains, it actually is surprising how much did get planted under very adverse conditions.  Basically, what did get planted in ND and MT essentially got done in less than 10 days of planting time.  Typically, this region gets 30 days of planting or more in springs (typically drought is the problem in western ND and MT). So, given the new GPS technology and farmers amazing ability to get things done, they essentially will still get 70-80% of the ground planted even in this disaster area, weatherwise! And since lack of moisture is typically the problem for this region (especially western ND and MT), one has to openly wonder if excess moisture on 80% of the ground might be able to produce 90% or more of a normal crop, production wise?  While temps have to be right (due to late planting), it might be surprising in the end of 2011 what high soil moisture levels and good germination can do for the crop in MT and ND.  So overall, perhaps 2011 won't be such a bad production year after all?

A lot can still happen in the production season, but perhaps our perception of a crop disaster in the US for 2011 has been grossly overstated?  We'll see in the end, but certainly the past 10 days have indicated a dramatic turnaround in 2011 US crop potential.  Perhaps marketers should take notice?

--------------------------------------

Ray Grabanski is President of Progressive Ag, a marketing and risk management firm for farmers located in Fargo, ND.  For questions or comments, or if you are interested in more information about Progressive Ag services, call 1-800-450-1404.  

Read more about

Crop Talk

Most Recent Poll

What stage is your corn in?