From the Editor for Aug. 12
Aug 12, 2011
From The Editor
August 12, 2011
Hello Pro Farmer Members!
Tough newsletter this week. Went to the printer later than I wanted it to... trying to figure out some stuff that really does matter to the price outlook for later this year.
Let's agree on this... the 2010 and 2011 growing seasons are similar, but far from the same.
The 2010 corn crop went in early, it seemed like every kernel emerged at the same time and growing conditions up to and during pollination were generally very good across the Corn Belt. Then after pollination, a heat wave accelerated crop development and ate away at yield potential.
The 2011 corn crop went in late, had questionable stands on the first 10% of the crop that was planted, early growing conditions were stressful and then the heat wave hit during pollination and lasted into the first 10 days to 2 weeks of kernel fill.
The main (only?) reason crop-watchers are drawing comparisons between 2010 and 2011 is the heat. Outside of that, these are two very different growing seasons.
So we've got two very different growing seasons and USDA sees the 2011 corn yield ending up where it did last year. Or does it? In August 2010, crop conditions were better, the crop was planted earlier and growers were much more optimistic about yield potential than they were in August 2011.
Let's make some assumptions:
- Corn ear populations are in an uptrend, so we'll assume the ear pops in 2011 are very similar to what we've seen the last two years.
- USDA used a five-year average ear weight in calculating the objective yield. The five-year average ear weight this year would be lighter than the five-year average ear weight used last year. Reason: 2010's ear weight was light compared to the previous four years. So, when the 2010 ear weight is included in the five-year average, it pulled the five-year average down... but just slightly. If the 2010 ear weight was 10% below the five-year average (that's a lot!!), then 2010 ear weights would pull the five-year average weight down just 2% from last year.
If those assumptions are accurate, then USDA's August 1 corn yield estimate should have been just below the August 2010 corn yield estimate of 165 bu. per acre. Think about it... similar ear populations with just a slightly lighter ear weight would result in just a slightly lower yield estimate.
That means "something" is missing. That has to be the farmer survey portion of the survey-based yield estimate. In 2010, growers were very optimistic about corn yields until heat started to melt off yield as kernels attempted to fill. This year, growers are not optimistic about corn yields. Therefore, we can only assume the biggest difference between last year's August yield estimate of 165 bu. per acre and this year's 153 bu. per acre is how farmers responded to USDA's yield survey.
Let's make another round of assumptions:
- Farmer's yield attitudes were about as poor as they'll be this year for the August survey. (Just think how stinkin' hot it was when the survey was taken!)
- 2011 ear weights will be below normal -- maybe not as light as 2010, but below the five-year average.
If those assumptions are accurate, then the corn yield estimate should continue to decline this year, but just slightly. That would indicate a steady to higher corn yield estimate from USDA in September... and potentially October. But, when the lighter ear weights from the harvested yield samples are factored into the calculation, it should result in a national average corn yield just below the August peg of 153.0 bu. per acre.
That's it for this week...
Have a great weekend!!