What is the USDA likely to do with late planted Corn?
Apr 30, 2013
We obviously all know planting is running behind schedule, and the latest weather models are showing we will fall even further behind our traditional pace in next weeks data. Remember what the USDA says, "Corn plantings by mid-May are important for yield potential because that allows more of the critical stages of crop development, particularly pollination, to occur earlier, before the most severe heat of the summer. Earlier pollination is also generally associated with less plant stress from moisture shortages." Keep in mind they have also made it well know that the planting progress and weather data used is primarily for eight key corn-producing States (Iowa, Illinois, Indiana, Ohio, Missouri, Minnesota, South Dakota, and Nebraska). Those eight states typically rank in the top 10 corn-producing states in the US and account for an average of 76 percent of US corn production.
- As of Sunday those key 8-states showed the following planting progress:
- IA 2% planted vs. 44% last year vs. 36% average
- IL 1% planted vs. 76% last year vs. 36% average
- IN 1% planted vs. 67% last year vs. 30% average
- OH 2% planted vs. 54% last year vs. 25% on average
- MO 15% planted vs. 71% last year vs. 42% on average
- MN 0% planted vs. 43% last year vs. 33% on average
- SD 0% planted vs. 28% last year vs. 12% on average
- NE 3% planted vs. 40% last year vs. 26% average.
Bottom-line, from what I hear the USDA likes to see 80% of the corn crop planted by mid-May (particularly in these 8-states). If 90%percent or more of the corn crop were to be planted by mid-May they would in turn tend to raise the expected corn yield by 2.89 bushels per acre. Similarly if only 70% percent of the corn crop is planted by the middle of May they would more than likely reduce their yield expectations by 2.89 bushels. As you can imagine, talks of lower yields in the June report, along with several bulls in the industry thinking that 3-5 million corn acres may now go unplanted has the bears backpedaling a bit.
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