Forecasts predicting extreme heat would creep farther north and east came true this week. Triple-digit temperatures remain parked along the Southern Plains, but now the majority of the western Corn Belt is starting at a worst-case weather scenario for crops now pollinating. Yet, the markets traded lower for much of the week.
The weather in the western Corn Belt could be causing some of the crop to lose yield. However, the heat wasn’t extreme in eastern Iowa, and recent rains mean the crop has the fuel it needs to grow.
“I actually think the heat here in Iowa, where we have plentiful soil moisture, a lot of the areas are benefiting the crop,” says Brian Grete, editor of Pro Farmer. “Now the areas in northwestern part of the state, southwestern part of the state where it’s drier, they’re going to see some of their crops hurt.”
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Could Iowa Have a Record Corn Crop?
Grete will lead a team of scouts next month for the annual Pro Farmer Crop Tour, which will be the first “boots in the field” scouting of this year’s crop on a large scale. Based on what Grete and Pro Farmer see on the week-long tour, Pro Farmer will then take that into consideration, along with conditions they didn’t tour, to come up with Pro Farmer’s yield estimate.
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Grete, who lives outside of Cedar Falls, Iowa, says he’s been driving across the state to get an early gauge of crop potential in the fields. What’s his current summary of Iowa? The corn crop is massive.
“What I’ve seen of the state, and I’ve seen quite a bit of it the past several weeks, is that we have a really big crop here in Iowa,” Grete adds. “The Illinois crop, there were areas that were a concern, and it’s really come along in the last three weeks. So, we’re looking at the central Corn Belt, and the No. 1 and No. 2 corn producing states of Iowa and Illinois are looking at very big crops right now. And so that’s going to probably offset some of those lost bushels in some of the other areas out to the western and southern parts of the Corn Belt.”
Last week, the funds remained on the sidelines of the commodity markets.
“I think the funds certainly could do a lot more damage to this market,” says Andrew Jackson of Producers’ Hedge. “One thing you have to ask yourself is how far do they want to push the market below $6 in corn, below $13 in beans and below $8 in wheat with a balance sheet as tight as it is?”
Jackson says based on current prices and sentiment within the trade, he thinks the current thought is a national average corn yield of 175 to 177 bu. per acre.
“That probably leaves us in an OK position, but it still leaves us with some risk if we do pull that crop down into the lower 170s on corn specifically. It’s a little early to start guesstimating what the bean crop might be,” he adds. “I think the trade believes this, too, but it’s hard for me to believe we’re going to see a corn crop below 170 [bu. per acre] this year, unless we have some really disastrous weather late.”
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Instead, Jackson thinks the trade believes U.S. corn supplies are going to be there this year.
“It’s probably not going to be a bumper crop, it may not be a 180 [bu. per acre crop], but maybe we’ve got enough gas in the tank get us through with the U.S. crop and then start thinking about record planted acreage in South America.”
While the yield debate will continue all the way through harvest, Grete says condition ratings show the health of the U.S. corn crop is good.
“Just based on where the crop condition ratings are here in mid-July, and I know that that isn’t a direct correlation to final yields, it does look like we have potential to get to a record yield nationally,” says Grete. “Now, everything probably has to fall in place. And we know that the long-term forecasts the National Weather Service just came out with this week signal it’s going to be hot, and it’s going to be dry for a good portion of that the growing area in the Corn Belt, especially the western and southwestern areas.”
Even though Grete isn’t taking the potential of record yields off the table, he acknowledges there are production problems in some areas, and the eastern Corn Belt isn’t perfect.
“We’re going to need some timely rains here, no doubt about that. But I can tell you that Iowa is very good right now, though that doesn’t mean there aren’t some problem areas. Illinois has come a long ways here in the past several weeks. And when you’ve got the No. 1 and No. 2 corn producing states in the United States ripping along like they are at the moment, you can offset quite a bit of (poorer yields) in some of those other states.”
2022 Pro Farm Crop Tour
Join one of the Pro Farmer Crop Tour events! In 2022, Pro Farmer Crop Tour gives you the opportunity to select your tour stop or watch online from wherever you are.
Register and attend nightly meetings in person or watch the nightly broadcast live each night where you’ll receive daily results, scouting observations and historical comparison data from our tour leaders.
