In the second consecutive week without a Crop Progress report from the US Department of Agriculture, “trade expectations”—the opinions of agricultural market experts—are fast becoming more valuable commodities in their own right.
What are these experts saying about the ongoing corn harvest? Dale Durchholz, senior market analyst at AgriVisor in Bloomington, Ill., said a recently published survey pegged the corn harvest at 31 percent completed as of the beginning of this week. He said he thought the number was too conservative, placing his guess at 35 percent completed and the soybean harvest at 45 percent completed, both well behind five-year averages.
From his vantage point in Bloomington, he sees a rosy picture of hefty yields per acre, average crop quality and good weather, except for a little rain, before a cold front is predicted to bring some frost by next weekend.
“The crop is about a week behind,” he said, nothing to worry about in anyone’s opinion. He noted that, in 2009, the corn crop was only 17 percent harvested by mid-October. He added that, during the many years he has been an observer of corn harvest in central Illinois, there have been times when combines were still in the fields on Thanksgiving Day.
Frost, he noted, could bring negative effects to crop quality in the far northwest Corn Belt in Minnesota and northern Iowa. However, real damage, he said, only comes when temperatures head well below freezing into the 20s, when any moisture in the corn (soybeans likely would be harvested completely by this point) may freeze the insides of combines.
“But that is not even a worry until mid-November,” he said.
He said good things about this year’s crops were that yield estimates have been excellent. He saw corn yields “real close to trend-line at about 161 bushels an acre” and soybean yields sometimes touching 110 bushels an acre, with a lot of 60 to 70 bushels-an-acre fields. The dry-down process has worked well, and soil isn’t muddy, which may be hard on machinery. Also important, he said, is that plenty of storage is available, some of it newly built, to contain the huge corn crop and the expected large soybean crop.
He said it was of great importance this year to replenish supply pipelines of both crops since inventories were tight from the 2012 drought year. He said the cash basis for corn and soybeans was likely to stay firm because lower prices, especially for corn, has “discouraged farmers from selling,” which could keep a lid on available new-crop supplies being made available.
The agricultural community has been coping well with the dearth of government data on the corn and soybean crops, but he hoped the partial government shutdown would end soon. In addition to the lack of official information available, the market has had to deal with more misinformation being generated, he said.
He said November Crop Production data would be especially important because it is the last such report until January.
“Whenever there is uncertainty, trading interest lessens and daily volatility goes down,” he said, noting volatility has decreased in both corn and soybean trading since Oct. 1, when the government shutdown began and fresh USDA crop data became unavailable on computer screens across America.