November 10, 2009

The US Department of Agriculture confirmed Monday (November 9) that producers last week made significant progress harvesting corn and soy and planting winter wheat because of a window of warmer, drier weather.

 

The USDA, in its weekly crop-progress report, said the harvests, particularly of corn, continue to lag behind the average. However, producers made solid advances last week and harvest progress was within industry expectations.

 

The corn harvest was 37 percent complete as of Sunday, up from 25 percent a week ago but far below the average of 82 percent, according to the USDA. The progress was within trade expectations that harvest would be roughly 35 percent to 43 percent complete.

 

The advance from last week shows producers worked hard to take advantage of the improved weather, said Jerry Gidel, analyst for North America Risk Management Services. They have faced delays due to wet conditions and the need to dry the crop.

 

"That's a pretty hefty set of numbers there, considering the type of drying issues we've encountered," Gidel said. "It seems like the corn guys were going full bore."

 

Still, serious delays persisted in key states. In Iowa, harvest was 34 percent complete, up from 18 percent a week ago but below the average of 81 percent, the USDA said.

 

In Illinois, harvest was 31 percent complete, up from 19 percent last week but below the 92 percent average. Indiana's crop was 41 percent harvested, up from 28 percent last week but below the average of 86 percent, according to the USDA.

 

"It would appear that excellent progress was made over the weekend," said Peter McKeegan, analyst for Top Third Ag. "There is still a lot of wet corn out there, although it is getting drier by the day."

 

The crop was 97 percent mature, below the average of 100 percent, after development delays due to late planting and cool, wet weather. It was rated 68 percent good to excellent, up 1 percentage point from last week.

 

Soy was 75 percent harvested as of Sunday, up from 51 percent last week but below the average of 92 percent, the USDA said. Traders had expected harvest to be roughly 71 percent to 78 percent complete.

 

"The weather is cooperating for now," McKeegan said. "There has been good harvest progress over the weekend."

 

In Iowa, 83 percent of the crop was harvested, up from 54 percent last week but below the average of 99 percent, according to the USDA. Indiana's crop was 81 percent harvested, up from 63 percent last week but down from the average of 94 percent. In Illinois, soy were 69 percent harvested, up from 35 percent but down from the average of 96 percent.

 

The estimate may be "a little negative" for Chicago Board of Trade soybean futures because harvest progress was so "solid," Gidel said. However, the markets will also be keeping a close eye on activity in the US dollar, he said. Weakness in the dollar helped soy and grains rally Monday.

 

Wheat planting was 86 percent complete as of Sunday, up from 79 percent last week but below the average of 93 percent, the USDA said. Citigroup had estimated planting would be about 85 percent complete.

 

Wet weather that delayed the US corn and soy harvests slowed soft red winter wheat planting because many producers in the Midwest and South seed SRW wheat after soy. The warmer, drier weather last week helped advance seeding, analysts said.

 

Planting was 63 percent complete in Illinois, up sharply from 35 percent a week earlier and below the average of 96 percent. Illinois plants SRW wheat, used to make pastries and snack foods.

 

In Ohio, the top SRW wheat-growing state, planting was 92 percent complete, up from 88 percent last week and blow the average of 96 percent, the USDA said. In Kansas, the top hard red winter wheat-growing state, planting was 90 percent complete, up from 83 percent last week and below the average of 97 percent.

 

HRW wheat areas in the central and southern Plains have not seen delays as significant as SRW wheat areas. HRW wheat is used to make bread.

 

Analysts have estimated that producers this year are seeding less winter wheat, particularly SRW wheat, due to the planting delays and weak prices. However, the surge in plantings from last week in SRW wheat states may indicate "there's a few more acres sneaking in here on the end of the period," Gidel said.

 

Total winter wheat emergence was 71 percent complete, up from 64 percent last week and below the average of 82 percent, the USDA said. Citigroup had estimated emergence would be a little farther along at 75 percent.

 

Ohio's crop was 63 percent emerged, below the average of 87 percent. In Kansas, emergence was 78 percent complete, below the average of 87 percent.

 

The crop was rated 63 percent good to excellent as of Sunday, down 1 percentage point from the previous week. Citigroup had estimated the rating would be steady or up 1 percentage point.