How the Crop Tour Will Affect Your Prices
Aug 23, 2011
I know by now you have already heard the crop condition ratings from yesterday afternoon. I will say I was somewhat surprised to see corn, soybeans and wheat ratings all lowered, considering producers in several areas are actually starting to feel a little better about their crop as of late. I did have a few side wagers, and will have to eat some crow as I was thinking the ratings would remain closer to "unchanged" this week. You have to believe dropping conditions like this will eventually force the USDA's hand to lower yields in both corn and soybeans. With these thoughts the markets will be looking to add premium in order to adjust to these new numbers.
I had some questions from subscribers regarding the Pro Farmer "Crop Tour" and their schedule. From what I have heard they have two large groups of scouts. One group in the east with some 60+ scouts, and one group in the West with 40+ scouts. Yesterday they completed tours in Ohio, South Dakota and parts of Nebraska. Today, they will be moving toward Indiana and Nebraska. On Wednesday, they will be working into Illinois and Western Iowa. They will wrap up on Thursday as they finish Iowa and complete Minnesota. Then on Friday, they will release their total corn and soybean crop estimates. Keep in mind, as a whole they generally tend to deliver a total corn yield number that is "HIGHER" than the USDA's final yield number. Over the past ten years, on average they have been 5-6 bushels higher that the USDA's final number. From what I have heard, they tend to estimate a little on the high side in the states of Minnesota, South Dakota and Illinois, and a little on the low side for Nebraska, Iowa, Indiana and Ohio. In any regards, I think they do a fantastic job, and commend all of those who put in their time and hard work out in the fields...Thanks for your efforts!
* Pro Farmer projected Ohio corn yields at 156.26 bushels per acre. 3 year year average is 158.03 bushels per acre. Pod counts for soybeans were reported as higher.
* South Dakota corn yields were projected at 141.10 bushels per acre. The 3 year average is 146.06 bushels per acre. Pod counts for soybeans were also slightly higher than the 3 year average.
On a side note, make sure you keep your eyes on the numbers in Illinois and Iowa in particular, as the trade seems very concerned that the current USDA estimates for Illinois to be 13 bushels (170 bpa) above last year's yield, and for Iowa to be 12 bushels (177 bpa) above last year's yield is simply unrealistic.
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