June 10, 2008
US corn in good condition drops while wheat rises
The amount of US corn rated in good-to-excellent condition fell in the week ended Sunday, and some top corn-producing states continued to see slow emergence compared with the five-year average, according to the weekly progress report issued Monday by the USDA.
US soy planting continued to remain well behind average, while the good-to-excellent condition rating for US spring wheat soared above the five-year average, the USDA report said. The good-to-excellent condition rating for US winter wheat remained the same as in the preceding week.
Wet weather has been the main factor hampering the US corn crop.
Heavy rains in states such as Indiana, Illinois, and Iowa is causing serious concern, said Joel Karlin, sales manager and commodity sales coordinator for Western Milling.
Widespread rainfall of 1 to 3 inches is probable across the wettest areas of the Corn Belt through at least Friday, and the weather is not likely to improve in the next 10 days, according to private forecaster T-storm Weather.
Corn
The USDA said the good-to-excellent condition rating for the US corn crop was 60 percent, down three percentage points from the previous week.
Traders had expected a five-percentage-point drop in the good-to-excellent condition rating from the previous week.
"It's probably a little better than people were thinking," said Karlin. "Maybe the (Chicago Board of Trade corn futures) market will sell off on this news."
Some of the top corn-producing states such as Iowa and Illinois, however, are still causes for concern due to the heavy rains which has caused some flooding, he said.
In Iowa, the good-to-excellent condition rating for the US corn crop was 56 percent, down 10 percentage points from the preceding week.
In Illinois, the good-to-excellent condition rating for the corn crop was 48 percent, down six percentage points from the preceding week.
"Crop condition ratings on newly planted crops should not be changing that much at this time of year," said Bill Nelson, grain analyst for A.G. Edwards. "When you have big point changes, it is really evident of some major weather event."
The USDA said 89 percent of the US corn crop was emerged, up from 74 percent last week but below the five-year average of 95 percent.
"The crop was late planting, and it led to late emergence," said Karlin, adding that at least four million acres will have to be re-planted. "That will probably lead to late pollination and late maturity."
Soy
The USDA said 77 percent of the US soy crop was planted, up from 69 percent last week but below the five-year average of 89 percent. As with corn, weather has been the primary hurdle to soy planting.
"It's very slow going for the soy crop," said Karlin. "They're still trying to plant, and there are some acres that might not get in the ground."
Traders had expected anywhere from 85 percent-87 percent of the US soy crop to be planted.
The soy market, however, will be more focused on other factors such as the farmer's strike in Argentina, said Karlin.
In Illinois, 66 percent of the soy crop was planted, up from 57 percent last week but down from the average of 92 percent.
The USDA said 56 percent of the US soy crop has emerged, up from 32 percent last week but below the average of 74 percent.
"This is not going to have a beneficial impact on yields," said Karlin.
The USDA said the good-to-excellent condition rating for the US soy crop was 57 percent.
Spring Wheat
The USDA said the good-to-excellent condition rating for US spring wheat rose to 63 percent, up six percentage points from the preceding week.
"The weather conditions in the Northern Plains improved last week and that resulted in better spring wheat ratings," said Karlin. "It appears that there were some states that benefited from some moisture."
In North Dakota, the good-to-excellent condition rating for spring wheat rose to 61 percent, up 10 percentage points from the preceding week.
In South Dakota, the rating rose to 68 percent, up three percentage points from the previous week.
