Evening Report (VIP) -- November 5, 2012

November 5, 2012 08:34 AM

WINTER WHEAT CONDITION DECLINES... USDA reports 39% of the winter wheat crop is rated "good" to "excellent," down one percentage point from last week and 10 percentage points below last year at this time. Meanwhile, USDA rates 19% of the crop in "poor" to "very poor" shape compared to 15% last week and year-ago. Given the warm, dry forecast for the Central and Southern Plains this week, traders will expect further crop condition declines in next Monday's report.

Winter Wheat

very poor





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USDA reports as of Sunday that 73% of the crop has emerged compared to 63% last week and 74% on average. Kansas has 87% emerged (80% on average); Oklahoma is at 70% (56% on average); and Texas is at 69% (61% on average).



CORN HARVEST 95% COMPLETE, SOYBEAN HARVEST AT 93%... USDA reports that 95% of the nation's corn crop was harvested as of Sunday compared to 91% last week and 71% on average. Meanwhile, 93% of the nation's soybean crop has been harvested compared to 87% last week and 86% on average.



COTTON HARVEST NEARLY TWO-THIRDS COMPLETE... USDA reports as of Sunday that 64% of the nation's cotton crop was harvested compared to 50% last week and 58% on average. Louisiana leads the way at 99% complete (87% on average), followed by Arkansas at 97% (81% on average) and Mississippi at 90% (81% on average). Texas has 56% harvested compared to 43% on average.



IMPROVED RAINFALL CHANCES FOR DRY AREAS OF BRAZIL... Following some beneficial showers over the weekend, forecasters say even better rains are expected across the northern region of Brazil's soybean belt. Meteorologist Gail Martell of MartellCropProjections.com says the forecast for Brazil's leading soybean state of Mato Grosso is extremely wet this week, as it calls for 2 to 5 inches of rain. Other tropical states, such as Goias, Mato Grosso do Sul and Sao Paulo, are also in line for beneficial moisture.

Meanwhile, Martell says conditions are still too wet in Argentina to continue planting corn. This is especially concerning since the ideal planting window closes this week, which leads to expectations many acres will be switched to soybeans. Click here for more, including maps.



DRY CONDITIONS TO PERSIST IN SOUTHERN PLAINS... Martell also says dryness in the U.S. Southern Plains will linger, which is a threat to the establishing winter wheat crop. "High pressure is expected to produce unseasonably warm and dry weather the next five days in the Central and Southern Great Plains," she says. "By Saturday, a strong cold front would push east across the Plains. Scattered showers are expected to develop with the frontal passage. Strong gusty winds up to 45 miles per hour are also predicted with the passage of the cold front Saturday. A hard freeze would follow Saturday night on the High Plains."



SEED COSTS EXPECTED TO RISE... Farmer may pay more for seed they will plant in 2013 due to the historic drought tightening supplies, but higher returns on their investment should more than make up for the increased costs, according to a Purdue University ag economist. Prices are expected to rise 5% to 7% for seed corn, 7% to 10% for soybeans and more than 10% for wheat seed, according to Alan Miller, a farm business management specialist at Purdue. That would mean a bag of corn seed would sell for between just under $200 to more than $300, depending on the variety. Soybean seed would go for about $50 a bag, with wheat seed priced in the low $20s per bag, according to Miller.


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