April 10, 2012

 

US corn planting doubles on mild weather 

Taking advantage of unseasonably mild weather even as some waited for insurance coverage to kick in before entering their fields, US farmers are planting at twice the record pace for this time of year, a Reuters poll showed on Monday (Apr 9).

 

A Reuters poll of 14 analysts pegged US corn seeding as 8% complete as of April 8, which would double the previous early-April record of 4%. A year ago, farmers had seeded 3% of their crop.

 

But most Midwest farmers kept their planters in the equipment shed, even as farmers further south made good progress. The farmers who held back were concerned about insurance and worried that the weather might take a turn for the worse following a record warm March, analysts said.

 

"A lot of these guys are still going to go ahead and wait," said Shawn McCambridge, analyst with Jefferies Bache. "It is only early April. Even though the weather has been favourable, we can get a shot of cold weather again."

 

Cold weather can hinder seed development, reducing the yield benefits of early planting, McCambridge added.

 

The USDA will release its weekly crop progress report on Monday afternoon. A week ago, USDA said farmers had finished 3% of their corn planting. The record for was set in 1999 and 2000. During the past 10 years, corn planting progress has averaged 1.4% during the first week in April.

 

Freezing temperatures blanketed the northern portion of the US early on Monday and the cold snap is expected to continue each morning through Thursday, moving into some key corn growing states such as Indiana, Ohio and Illinois, said John Dee, meteorologist for Global Weather Monitoring.

 

Dee said the lowest temperatures would be in the upper 20s (degrees Fahrenheit) to low 30s. Rainfall is expected to move into the Midwest later this week, which could cause further delays to farmers hoping to get in the fields.

 

Growers hope that by seeding their corn early it will be safely past its key pollination phase by the time scorching heat arrives in the US Midwest in July. High temperatures during pollination often result in smaller yields at harvest.

 

Farmers that face delays past mid-May often seed some acres they intended to use for corn with soy, which is seen as a less profitable crop this year. Many insurance contracts for farmers in the Midwest stipulate that they will not pay for re-planting a crop if a cold snap destroys corn that is planted before a certain date, causing many farmers to hold back even if their fields are ready for seeds. Farmers also may have trouble finding enough corn seed to replant crops if their seeded acreage is damaged.

 

"You have double trouble," said Don Roose, analyst with US Commodities.

 

Most insurance contracts offer full coverage for mid-April planting so the pace should pick-up by the end of this week if the weather allows, Roose said.