Evening Report -- July 24, 2012

July 24, 2012 10:24 AM

CONSULTANT: WESTERN CORN BELT WORSE THAN EXPECTED... After touring Iowa, Minnesota, South Dakota and Nebraska over the weekend, Pro Farmer crop consultant Dr. Michael Cordonnier concluded conditions are worse than he expected. Dr. Cordonnier says, "We had been hoping the western Corn Belt could compensate for some of the problems in the east, but that is not going to happen. In fact, I thought some of the western areas were much worse than Illinois, for example. Some of the best corn is in northern Illinois and some of the worst corn is in South Dakota and Nebraska. Soybeans have not been hurt as much as corn -- at least not yet."



CONSULTANT SLASHES CORN ESTIMATE, TRIMS SOYBEANS... Dr. Cordonnier reduced his harvested corn acreage number to 84 million, saying the number of corn acres harvested for silage could be as high as 10 million this year due to drought. Additionally, Dr. Cordonnier slashed his corn yield estimate by 10 bu. to 130 Bu per acre. That combination puts his corn production forecast at just 10.92 billion bushels. Dr. Cordonnier now puts his minimum crop estimate at 9.24 billion Bu (110-Bu yield) and his maximum crop estimate at 11.76 billion bushels (140-Bu yield).

For soybeans, Dr. Cordonnier trimmed an additional 500,000 acres off his harvested acreage estimate to 73.3 million. He also trimmed his soybean yield estimate by 1 Bu to 38 Bu per acre. That puts his soybean production forecast at 2.78 billion bushels. Dr. Cordonnier now puts his minimum crop estimate at 2.41 billion Bu (33-Bu yield) and his maximum crop peg at 2.93 billion bushels (40-Bu yield).



NWS 6-10 DAY: IMPROVED PRECIP CHANCES FOR EASTERN BELT... The National Weather Service (NWS) forecast for July 30-Aug. 3 calls for above-normal temps across all of the Corn Belt and Mid-South, with the greatest chances for above-normal temps centered over Nebraska, Kansas and Missouri. The precip outlook is somewhat improved for the eastern Corn Belt as Wisconsin, far northern Illinois, the northeastern half of Indiana, and all of Ohio are expected to see above-normal rains during the period. This contrasts with the western Belt, which has normal to below-normal precip chances. Click here to view the maps.



BOEHNER PLEDGES ACTION ON U.S. DROUGHT... House Speaker John Boehner (R-Ohio) today said GOP leaders are working with House Agriculture Committee Chairman Frank Lucas (R-Okla.) and other panel members on the ongoing drought disaster gripping the majority of the nation. Boehner last week said crop insurance should be sufficient to cover farmers' needs this year, but key disaster aid programs for livestock producers have expired. Also, language in USDA's Fiscal Year 2012 budget bars the agency from providing aid through a program used in the past to aid livestock operations for weather-related losses.

The pending House- and Senate-passed farm bills include livestock disaster aid programs that would be retroactive to this year. Separate bills have been introduced in the Senate and the House regarding those programs, but they also include an extension of the controversial SURE program that would be another crop disaster aid program for crop producers who already have funding for crop and revenue assurance programs. The SURE program had a separate $100,000 pay cap when it was available. The Congressional Budget Office in the past has projected SURE costs at around $1 billion per year. It was not part of the Senate-passed bill, nor the farm bill that passed the House Ag Committee.


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