Friday, May 22, 2009

The Debts of the Spenders: Western Corn Belt Gets Planting Done

Be ready for a pullback in corn prices. Some arb traders are running bull spreads on soy while also shorting corn.

Western Corn Belt Quietly Gets Its Planting Done

Producers in the western corn belt are spending the spring exactly where they most want to be - in the fields and out of the news. While Illinois and Indiana remain under the microscope due to soggy weather that has pushed planting well behind, agronomists further west say that
planting is all but done and the outlook is good.

“I would say we look very good as a whole. It looks like we’ve got pretty good stands everywhere,” said Mark Wooldrick, with E-Valley Agronomics, in West Point, Neb. “If you’re looking for gloom and doom, you’re not going to find it around here.”

The state had planted 93% of the crop as of Sunday, up from 79% last year. Iowa and Minnesota are similarly in good shape, with 90% planted in Iowa, compared to 73% last year, and 90% in Minnesota, up from 62% in 2008. Those numbers should be close to 100% when the U.S. Department of Agriculture releases its crop progress report Tuesday, agronomists said.

Emergence in all three states was also at or above the five-year average. Illinois, by contrast, was only 20% planted as of Sunday, and Indiana was 24% planted.

The strong progress in the western corn belt has helped cap upside movement in the corn market, analysts said. “We’ve got five major corn producing states, and we’ve got 60% that are off to probably some of their better starts than they’ve seen in a number of years,” said Chad Henderson, analyst for Prime Ag Consultants.

He added that the western progress sometimes gets forgotten because “no one wants to hear about the crop that looks good.”

Source: CME News for Tomorrow
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