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September 27, 2012 11:53 AM

We're working ahead on the front page of this week's newsletter to make time to digest Friday morning's USDA Small Grains Summary and Quarterly Grain Stocks Report. We've still got a lot of work to do on the newsletter, but here's a preview of what we've got on the front page of the newsletter so far:

Corn-on-corn disappointing

Not every field of corn-on-corn is resulting in disappointing yields this year, but PF Members tell us the yield drag has been amplified by 2012’s drought. Many of these growers will cut their corn-on-corn acres for 2013, meaning a “lean” toward more bean acres and fewer corn acres next year.

Vacation is over! Back to reality

Europe’s “generous” summer vacation schedule for most workers normally results in a lack of economic productivity. This year, evidence is growing the slow economy there didn’t “heal” as workers vacationed. The need for stimulus and bailout packages is climbing again, erasing some of the risk-on attitude in the commodity world. That will likely extend the grain markets’ harvest-season slide.

Corn harvest nearing half-done

U.S. corn harvest was 39% done as of Sept. 23, three-times as fast as the five-year average pace. With a clear skies last week, corn harvest will be 50% done by Oct. 1.

In some areas, harvest has already cross the midway point. Illinois is already 54% done with the 2012 corn harvest and basis is firming across the state. Most likely, that’s a preview of what will happen in other areas as many will put the second half of the short-crop in the bin.

China is back and buying beans

USDA reported Sept. 27 that China bought 110,000 metric tons (MT) of U.S. soybeans for delivery in the 2012-13 marketing year. That was on top of strong sales of nearly 800,000 MT in the week ended Sept. 20. Unknown is if the Sept. 27 sale marks the start of a string of “value buys” by China. If the importer sees value at current levels, there is very little downside risk in bean futures.

Iowa farmland values up 7.7%

The value of Iowa farmland rose 7.7% from March to September, according to a survey conducted by the Iowa Farm and Land Chapter #2 REALTORS Land Institute. Couple that gain with the 10.8% rise found in the September to March survey and Iowa farmland values gained 18.5% in the year ending Sept. 1.

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