Watch Weather In Next Few Weeks For Crop Marketing Clues

Watch Weather In Next Few Weeks For Crop Marketing Clues

Large acreage of corn and soybeans in 2013 could produce huge crop, despite late planting.

Farmers attending a series of "Crop Weather & Market Outlook" meetings held by Iowa State University Extension at locations around central Iowa the last week of June said they had varying degrees of success getting crops planted on time this year, thanks to a record wet spring. The planting delays resulted in a lot of fields having corn and soybean stands that aren't very uniform. The farmers also said, although crop development is still behind normal, recent days of hot weather are helping the plants "start to catch up."

WEATHER WATCH: With super-tight old crop supplies of corn and soybeans, development of the new crop in the weeks ahead will be a major price maker. "Two-thirds of the 2013 U.S. corn crop will pollinate the last two weeks of July this year, a little later than normal, and some corn will pollinate in August," says market analyst Don Roose. "A lot of the late-planted and replant corn could be hurt if there's an early frost."

Steve Johnson, an ISU Extension farm management specialist, told farmers at the June 26 meeting in Ankeny that new-crop and old-crop sales of corn and soybeans are currently slow. "But this could change soon," he says. "By mid-July you need to find a home for old-crop corn and soybeans. It's not time to be a hoarder."

USDA's 2013 Acreage Report was released June 28. It indicates farmers have planted the most corn acreage in the U.S. since 1936. Based on surveys conducted the first half of June, USDA estimates there are 97.4 million acres planted to corn this year, slightly more than last year. Soybean acreage nationwide, at a record 77.7 million acres, is up one percent from last year.

By about July 15 the 2013 crop will be coming along and the market will be watching. Prices will react to indications of a big possible new crop coming, says Johnson. Corn will be entering the pollination period, a crucial time for the crop, a little later than normal this year. Farmers can monitor growing degree days (GDDs) for their part of the state on the Iowa Mesonet website.

Weather problems at pollination could alter the outlook for big 2013 crop

Soybean and corn markets have trended lower the past couple weeks and that isn't expected to change in the near term, says Don Roose, market analyst and president of U.S. Commodities Inc. of West Des Moines. He was another speaker on the program at the ISU Extension meetings. "However, a weather scare could change the outlook and indicate that we may not have the big 2013 corn and soybean crops USDA is now forecasting," says Roose. "A weather scare would add strength to prices. But currently, the market is paying attention to the old adage that 'rain makes grain'—and prospects are for big 2013 crops to develop and for lower prices ahead."~~~PAGE_BREAK_HERE~~~

Roose says farmers should watch a high pressure weather system that is now building over the Rocky Mountains. Whether it stays west or moves east toward the Midwest will influence growing conditions in the Corn Belt and thus affect commodity markets. The high pressure ridge over the Rockies usually allows cooler, drier air from Canada to move down into the Midwest. This year's late-planted, delayed crop needs heat units to catch up to normal development, but it does not need excessive heat during pollination. If the high pressure ridge moves east, then hotter, moist air from the Gulf of Mexico usually comes into the Midwest.

"The grain trade will get really excited if this high pressure system moves into the Midwest," says Roose. "Keep in mind there are different ways to shore up your crop marketing plan. You can buy calls or puts, use synthetic short hedges, or use short-dated options."

On average, Iowa is now running about 110 growing degree days behind normal

A third speaker at these meetings was Dennis Todey, South Dakota's state climatologist and an associate professor at South Dakota State University. Todey grew up in southern Iowa and earned his degrees from Iowa State. He says there's a 60% chance the high pressure ridge will remain over the Rockies. As of June 26, the 8 to 14 day forecast from the U.S. Weather Service calls for cooler-than-normal temperatures and less rain for the Corn Belt. However, he doesn't expect the rain to shut off completely.

Todey says that on average, Iowa is 110 growing degree days behind normal in terms of crop development as of the last week of June. "It will be nice for people to be outside, but not good for the corn," he says of the forecast for cooler weather. "We're approaching the point where we need to move crop development along."

It doesn't appear that either an El Nino or a La Nina will affect the Midwest during the 2013 growing season. That weather indicator is currently in neutral. "I think we'll be okay and we will get this year's corn and soybean crops to maturity before the first fall frost hits," says Todey. "But the corn will likely be wet at harvest this year, thanks to the late-planted crop and this delay in development."~~~PAGE_BREAK_HERE~~~

On that note, Nick Hyde, a grain merchandiser for Heartland Co-op, which has 50 locations in Iowa, mostly in central Iowa, spoke to the meeting. He said farmers will want to get their grain dryers tuned up this summer, ahead of time for fall harvest. And get their propane supplies lined up. "We are getting our grain elevators ready for fall," says Hyde. "We are preparing them for handling wet grain at harvest this year. We're increasing our leg capacity for grain handling at several elevators and installing some new grain dryers and updating others. Like many farmers, we haven't had to use our grain dryers a lot the past few years. But we expect that will change this year with what looks to be potentially wetter corn at harvest."

Where are we with weather and development of this year's crops?

Wallaces Farmer interviewed SDSU climatologist Dennis Todey after the ISU Extension Crop Weather and Market Outlook meeting on June 26.

Q: Where are Iowa and most of the middle of the Corn Belt now, in terms of crop maturity at the end of June 2013? 

A: We are around 110 degree days behind normal, which is equal to about 5 or so regular calendar days. It's not a big lag, but we can't afford to have a cool summer. The farther south you go in the Corn Belt, the warmer it tends to be in summer--so the better chance you have of crops reaching maturity before the first killing frost hits in the fall. The farther north, you run a greater risk of experiencing a problem in the fall if you have a cool summer. In northern Iowa and in Minnesota and the Dakotas you don't get as much heat to add on as many degree days during the year. So, if you knock off some of those days due to late planting, and have a cool start to the growing season, it reduces the chances for the crop to reach maturity before frost.

Q: Starting July 4th or so, it's time to begin watching the growing degree day accumulation closely--because we need the heat?

A: Yes. We are at a point now where we don't want temperatures to be too much above average because that can start stressing a crop. That's a concern especially this year because in many fields we don't have as deep of a root system developing as we'd like. However, too many days of below normal temperature in July would cause concern because it would push crop development later on in the growing season. That pushes maturity later and we would get closer to the potential first freeze date.~~~PAGE_BREAK_HERE~~~

Q: The big question is—how many degree days can we accumulate before the average date of the first killing frost?

A: I'd have to look at some numbers for your particular location in the state. We'd want to figure how many degree days we could accumulate in the time remaining between now and the average date of the first killing frost. What if we have a cool summer? Or, perhaps a warmer than normal summer? How many heat units could we accumulate in such situations? That would give us an idea of the risk of getting the 2013 crop mature before frost.

Overall, the answer I'm giving people today is I think we're still going to be okay this year. It will be a little tighter than we want it to be in terms of having the crop reach maturity before the first killing frost strikes, but I think we'll be okay. We certainly want to be watching for a potential freeze once we get to late August or early September—to make sure we don't have an early frost sneak in on us.

Q: You talked about precipitation variability—you said rainfall will be more variable than normal over the next 20 years or so, and it's going to be hard on farmers.

A: Farmers will have to learn to manage risk. Risk management is what it's all about. I hope we will be able to provide people with the information and climate tools we can use to help them manage the risk somewhat. But no matter what, there will be risk involved in farming, much of it driven by variability in weather.

Q: Why do climatologists talk about and pay attention to El Nino and La Nina?

A: If you have an El Nino event occurring in summer you are quite likely going to have a good crop in the U.S. Corn Belt. Or another way to say this is that generally, if we have an El Nino in summer, we are very unlikely to have a bad crop. But if a La Nina occurs in the summer, yields will likely be hurt. Right now it is neutral—we're not in either an El Nino or a La Nina phase in the weather cycle.~~~PAGE_BREAK_HERE~~~

Q: The year 2013 is often compared to being like 1947 in terms of weather patterns. That bothers people when they realize that in 1947 the rain shut off pretty much completely during the last half of the growing season. What happened in 1947?

A: I looked that up the other day in the weather records. In Iowa, July and August of 1947 averaged less than 2 inches of rain total across the state. The statewide average temperature for Iowa in August of 1947 was around 80 degrees F. Not only did the rain shut off in Iowa but Iowa was actually warmer in August than in July.

Right now I don't see that happening in 2013, fortunately. I don't see a repeat of 1947 occurring this year. I lean toward expecting we'll have near average temperatures this summer or maybe a little cooler than average for Iowa and the middle of the Corn Belt, in general.

Q: Do you think crops will likely reach maturity in 2013—generally in the Corn Belt—before the first killing frost hits?

A: Yes, I think so. The further north you go, the more concern I have, however, especially with the later planted corn and soybeans. The further south you go, it's a little longer growing season and they have a later average date for their first fall frost. Thus, crops have a better chance of making it to maturity in the southern region of the Corn Belt than in the northern region.

The far eastern part of the Corn Belt is the garden spot this year—it looks like farmers there are going to be in great shape with their crops and harvest prospects for 2013. Places in Ohio will have corn tasseling by the 4th of July. They were a bit warm early this spring and they stayed warm. They are currently a little dry but are moving along at a good pace for crop development.

For farm management information and analysis visit Ag Decision Maker; ISU farm management specialist Steve Johnson's site is available here.

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