There is no doubt farmers have been burning theoil this past week. In fact Iowa planted 56% of their crop and as a whole corn planting here in the US is 71% complete vs. just 28% last week. This brings up a very interesting point: With close to 50% of the US crop ALL going in the ground (late) during the same 7-10 day planting window (May 10-20th), I am of the opinion, the price of poker for "pollination" just escalated dramatically. Meaning the mid-to-late-July time period will now be mission-critical for the US corn crop. Any type of extreme heat or dryness could put an abnormally LARGE portion of our crop at risk.
Lets also not forget, as our good friend Chip Flory over at Pro Farmer points out, "the corn plant reaches physiological maturity about 56 days after pollination. That means the crop could still be trying to add yield when days are getting too short to gather all the energy needed." Right now I have to believe the market is currently trading a 153-158 type yield number. With over 95 million corn acres almost certain to go in the ground this type of yield does very little to excite the longer-term bulls. However, if we were to see the extend Jun-Jul-Aug forecast show more heat and less moisture, a sub-150 yield could start to become more of a reality and the bulls might once again start to run. Lets also keep in mind I am starting to hear a few more producers talking about switching to shorter varieties (some 82-day varieties even being discussed), the question is how dramatically will the shorter varieties affect overall yields? With these cards still in the deck, I currently feel that most producers should sit tight with between 40-60% priced or hedged.
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