Inflation? Maybe in gold, base metals, and the aussie dollar. But certainly not in agricultural grains. About the only thing that can stop the bears from ravaging corn and soybean prices is an early frost and/or fungal disease outbreaks. But in the meantime, farmers are expecting a bumper crop.
Reports of record-high crop yields are filtering in, as U.S. farmers begin gathering their annual autumn harvest with combines working in fields as far north as southern sections of Illinois.
The soybean crop in northwestern Mississippi is “15%-20% bigger than last year’s record yield...corn yields are very near to the last couple years and very good in general,” reported FCStone.
“Bean yields will be a record, by a mile,” averaging as much as 75 bushels per acre.
Although the U.S. Department of Agriculture has yet to begin issuing official estimates of corn/soybean harvest progress, individual state crop updates indicate that some 650 million bushels of corn, 115 million bushels of grain sorghum and 30 million bushels of newcrop
soybeans have already been picked nationwide.
Yield reports have varied widely in some areas, dependent on when the fields were planted, their soil type and the amount of rain received. In Louisiana, “farmers are harvesting
corn, and yields vary dramatically,” said LSU AgCenter extension associate Rob Ferguson. “Some farmers are getting nearly 200 bushels to the acre - near record levels - while others are seeing yields as low as 50 bushels to the acre.”
Corn harvest is already 90% done in Louisiana and 60%-67% complete in such states as Georgia, Mississippi, South Carolina, and Texas. Almost a quarter of the 2009 corn crop has been cut in such states as North Carolina and Oklahoma, with progress approaching 40% in Arkansas, as well.
“Supposedly the southern corn crop is better than average, with some yields into the 200 bushel category,” said Rich Balvanz of AMS Commodities. Picking has even begun in southern parts of Illinois, which is expected to be the nation’s second-largest corn-producing state this season.
The “first two loads of new corn [were] dumped in our elevator on Sept. 8,” one Pike County, Illinois source told MF Global analyst Rich Feltes.
Early corn yields from southern Illinois - reported at 150-190 bushels per acre - were described as “better than expected.” The soybean harvest is far less advanced, estimated at 35% complete in Texas, 28% finished in Louisiana, 14% done in Mississippi, 7% complete in Georgia and 3% finished in Arkansas.
“Early soybean yields from Arkansas and Mississippi are coming in 10 bushels per acre higher than last year,” reported Ed Dugan of Top Third Ag Marketing. Robert Goodson, extension agent in Phillips County, Ark., estimates that about 5% of the 249,000 acres planted to soybeans
in his county have been harvested. He said yields are running from 18 to 65 bushels an acre, with an average of 45 bushels an acre. By contrast, Ron Levy, LSU AgCenter soybean specialist, said early harvested beans in Louisiana are showing the effects of a dry spring, producing
yields in the teens, which is far below their normal 30-40 bushel average.
“A lot of these beans that were early went through the worst part of the drought,” Levy said. “We’re seeing late season disease issues in there - quality issues and yield losses.”
Despite the variability in initial field reports, Feltes said that overall, early yield updates have been, “remarkably consistent in reporting better-than-expected yields. One can be fooled by early yield returns, but our experience is that first yield reports set the tone on perceived
crop size and price.”
Feltes predicts that reports of record southern bean yields will continue to weigh on the cash market until major producing areas in the Midwest begin picking in late September.
Source CME News for Tomorrow
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