Allendale Inc will note dating back to 1985 there are two similar years when the harvest progress of corn is near the delay we are presently experiencing. As of Sunday, Nov 29, 2009 the nation’s corn harvest is 79% complete and understandably delayed. This 79% completion level pales in comparison to a five year ave level of 97% and 94% last year. The question which is asked, can we anticipate USDA to decrease planted or harvested acres or could we experience a reduction in yield, production or end stocks and thus a rally in prices from the Nov to Dec WASDE?
If we look at the two similar delayed harvested years of 1985 and 1992 you will need to be the final judge as to whether USDA has a surprise up its sleeve or not. In 1992 for the same week of the marketing year, the corn harvest was only 75% complete and in 1985 the harvest was 87% complete, no other two years have seemed so distant. Within 1985 there was no change within the yield, planted or harvested acres or production, end stocks or season average farm price for corn contained within the Dec from Nov report as well as the Jan from Dec USDA WASDE reports. Thus with 8% more of the nation’s 1985 corn harvest more complete than the 79% presently harvested the delayed harvested year was of little help from Nov to Jan.
1992’s harvest at 75% was running at a 4% lesser pace than present and yet did not contain any significant surprises within the Dec WASDE. The only revisions we can find are a shade smaller end stocks in Dec WASDE report which increase the season ave farm price by 5 cents on the low and high end as well as a yield increase in the Jan WASDE report. It was within the Jan WASDE report that USDA did hold a major surprise by increasing yield by 2.1 bushel per acre and thus increased production and ultimately end stocks by 150 million bushels.
Allendale Inc informs the producer of corn, when harvest can find two similar years to this years lag, there were no changes from the Nov to Dec with relationship to yield, planted or harvested acres. Only from the Dec to Jan 1992 WASDE report could we find a significant yield adjustment, and bearish to yield and ultimately end stocks. If there is any good news at least in the Jan WASDE, USDA did not lower the season average farm price.
Allendale Inc did release its Dec 2009 production, U.S. and World end stocks date to official news agencies eight full days in front of the Dec 10, 2009 USDA WASDE launch. We are able to inform you, we did not change yield but did change end stocks for corn, soybeans and wheat. If you would like a similar copy e mailed to you, please contact us.
Fundamentals suggest a weaker outlook for corn and wheat as they are not demand driven, soybeans are. Are we trading fundamentals, are you taking action of 2009 and 2010 crops?
We welcome your questions and comments.........Joe Victor
Allendale Inc welcomes any questions you may have by calling 800-551-4626 or
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