When does heat become "too much of a good thing?"
Jun 23, 2009
Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm, but taking care of two horses in the morning before I head in for work gives me a little time to think about the day ahead. Each morning, stop at this spot to get a feeling for the "tone of the day" - and some attitude about agriculture and the markets.
I was thinking…
... about the riders on the 13th Annual Great Iowa Tractor Ride. The event is sponsored run by WHO Radio (1040-AM) and is supposed to be a nice, relaxing get-together with other people who enjoy restoring tractors and taking the "old iron" for a drive every now and then. I saw one of the "squads" of tractors driving yesterday and it really is a cool thing -- some dads had a kid with them, some grandmas had a grandchild, some husbands had their wives. It's a family event these iron-lovers look forward to every year. Well... maybe not every year -- or at least every day. Today their entire route is in the middle of a heat advisory area. Yesterday, the heat index was 100-degree-plus... and it might get hotter today. Last night at the College World Series in Omaha, Nebraska, the heat index was 107 degrees at 9:30 p.m.!
Last week, growers across the Corn Belt were asking for a "little heat and sunshine." Whoa... this is one of those "be careful what you ask for" things. We've got lots of heat and lots of sunshine going right now. Traders are calling weather conditions "exactly what the crops need." That's part of the reason for recent pressure on corn and soybean prices.
Another reason is a factor that dates back to March 31 and the Prospective Plantings Report. Most market-watchers said, at the time, total planted acres (to all crops) was too small... that those "lost" acres would eventually come back into play. With the June Acreage Report coming early next week, traders are generally expecting corn acres to be down about 1 million from planting intentions; bean acres to be up 1 million. But, the "whisper" number that's starting to have an impact is steady on corn and "up big" on bean acres because those "lost" acres will work back into planted acreage.
Have you checked out the new www.profarmer.com?
There's a couple of things you should check out... both are under the "Markets" tab at the top of the page. From there, you can get "streaming quotes." These are still delayed quotes, but streaming quotes show you a every price tick and give an idea of momentum in the market. Also under the "Markets" tab, you'll find interactive charts. If you like using intraday, daily, weekly and monthly chart analysis in your risk management, you've got to check out these charts. You can also add a long list of studies, draw trendlines, add comments... it really is one of the best FREE charting packages available.
I say FREE, and that's true until July 1. At that point, www.profarmer.com will be locked up for Pro Farmer Members only. To be a Member and to get access to everything we do and offer on the site, you'll have to be a subscriber to Pro Farmer services. The new and enhanced www.profarmer.com is included in your Pro Farmer Membership at any level (Classic, Preferred and VIP). On the site, you'll get early-morning comments from PF News Editor Roger Bernard in News From Around the World; from PF Sr. Markets Editor Julianne Johnston in From the Bullpen; and from PF Sr. Market Analyst Brian Grete in Marketing Toolbox. You'll also have access to daily comments from PF Washington consultant Jim Wiesemeyer in Inside Washington Today. And we're presenting news in a slightly different format -- in addition to a "harder sort" on the news we decide to put on the site, we are also including a quick comment at the end of news stories to give you what we think about the news item.
So -- will this turn into "too much of a good thing?"
If you believe the 6- to 10-day and 8- to 14-day outlooks from the National Weather Service, it might. The long-range forecasts call for above-normal temperatures across the Corn Belt for the next two weeks. It will be interesting to see how shallow-rooted crops in the eastern Belt handle the heat. If I had to put a timeline on when heat turns from being perceived as a positive for crop development to a "threat" to yield potential, I'd guess it will be coming back to work after the three-day Fourth of July weekend.