I will admit that I was surprised. The bears had been firmly in control of grains since mid-June. Threats of fungal infection, insect pests, and frost had been dismissed as large supply overhangs left a dark cloud over prices. In addition, a still developing El Nino weather front in the Pacific created the possibility of more bearish overhang (El Nino patterns are usually associated w/mild winters).
Midday Weather Models Raise Midwest Frost Threat
U.S. midday weather models point to colder weather patterns for northern and northwest Midwest growing areas.
A strong high pressure system is seen pushing colder temperatures in the upper Midwest beginning Thursday and Friday of next week. This is slightly colder than previous model runs, with a damaging frost or potential freeze shown across much of the Corn Belt later next week
“The frost threat is definitely there, with midday models increasing the threat of freezing temperatures in north and northwest Midwest late in 6- to 10-day forecasts,” said Donald Keeney, meteorologist with Cropcast Weather Services.
“If Wednesday morning’s models come in the same way, then there would be more potential to see temperatures in the upper 20s Fahrenheit into Iowa and Wisconsin as far south as the Illinois border,” Keeney said. If the model verifies, there would be temps in the upper 20s Fahrenheit in northern Missouri and mid 20s Fahrenheit in Minneapolis.
However, the freezing temperatures are not expected to drift into central Illinois, Indiana and Ohio, he added.
The midday U.S. weather model is colder than the overnight models suggested, featuring chilly temperatures Tuesday, Wednesday and Thursday of next week, said Joel Burgio, meteorologist with DTN Meteorlogix.
There is reason to be cautious with the model run, as it looks “kind of extreme”, particularly with forecasts over seven days out more suspect, Burgio said. The market and meteorologist alike will be looking for continued verification of this forecast in the European weather model released after 5:00 p.m. EDT, he added. T-storm Weather’s Mike Tannura said a cooler pattern is likely, but a damaging frost is not imminent because the potential event is still 8-9 days away.
“Our best estimate of the region calls for minimums in the 30s and potentially upper-20s
later next week-Minnesota through Wisconsin,” T-storm Weather said in a midday forecast.
The markets have rushed to put weather premium back into prices, as the threat of frost raises concerns that record crop potential estimated by the U.S. Department of Agriculture maybe questionable. U.S. corn and soybeans are currently running from a week to two weeks behind in maturity, following late plantings and record cool summer weather.
Source: CME News For Tomorrow
Wednesday, September 16, 2009
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