3 Big Things Today, August 25
1. Corn, Beans Lower as Traders Already Skeptical of USDA’s Lofty Expectations
Corn and soybeans fell overnight despite another disappointing day on the crop tour as participants again failed to find expected record yields.
Iowa corn growers are expected to harvest almost 5% less than the 197 bushels an acre the Department of Agriculture had forecast, while those in Illinois will see yields come in 3.3% below government projections, according to field estimates. Crop tour participants have found less-than-stellar yields the past three days.
Many traders, however, were already skeptical of the numbers released by the Department of Agriculture in its monthly Supply and Demand Report earlier this month, which has kept a lid on prices.
Corn futures for December delivery lost ½¢ to $3.35¾ a bushel on the Chicago Board of Trade.
Soybeans for November delivery declined 7¢ to $9.98¼ a bushel, soy meal futures for December delivery fell 40¢ to $326.50 a short ton, and soy oil lost 0.38¢ to 33.61¢ a pound.
Wheat futures for December delivery rose 2¢ to $4.28¼ a bushel overnight in Chicago, while Kansas City futures gained ¾¢ to $4.34¾ a bushel.
2. Disappointing Yields in Iowa, Illinois Not Surprising to Traders, Farmers
Many people were expecting record corn yields in Iowa and Illinois, the biggest U.S. producers of the grain, but that’s not come to fruition thus far, if participants on the ProFarmer crop tour are to be believed.
The findings, however, aren’t that surprising to traders who were expecting poorer-than-forecast yields and to farmers who have been the ones actually in the field.
In Iowa, the corn yield was pegged at about 188 bushels an acre by tour participants, well below the 197 bushels the USDA estimated and last year’s 192 bushels. One crop scout suggested on social media that the crop looked better from the road than it did from the field.
The same apparently was true for Illinois, where corn yields are forecast at 194 bushels an acre, down from a USDA outlook for 200 bushels and the record 200 bushels an acre collected in 2014.
Corn yields on the crop tour this year have been disappointing across the Corn Belt. It started in Ohio, where scouts had expected to find crops that weren’t in great shape due to hot and dry weather, and in South Dakota, where the weather hadn’t been ideal. Alarms began to sound, however, when corn in Nebraska and Indiana was, for all intents and purposes, disappointing.
The Iowa and Illinois numbers (as many traders and farmers have been saying for quite some time) weren’t as good as the rest of the world had expected due to a range of reasons from large amounts of green snap from strong winds to reports of disease.
The final numbers for the crop are due today, and it’ll be interesting to see how far below the USDA average the crop tour estimates.
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3. Severe Storms Persist Day After Tornadoes Rip Through Indiana, Ohio
Severe storms continue to pound much of the Midwest and Plains this morning.
Tornadoes tore through Indiana and Ohio on Wednesday, toppling buildings and leading the governor of Indiana to declare a state of emergency in Kokomo. About a dozen injuries were reported in the town, but none reportedly thought to be life threatening.
More storms are on the way for much of the region, the National Weather Service said in a report on Thursday morning.
“Severe thunderstorms that can produce strong wind gusts, hail, and tornadoes are possible this afternoon in to the evening from the Central Plains to the Ohio Valley,” the NWS said. “Heavy rains are possible over the Central Plain and the Middle Mississippi Valley.”
Several counties in northeastern Iowa are under a flood warning, and some counties in Missouri along the Missouri River are under a flood advisory, according to the service.
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