October 30, 2007

 

US Crop Progress Wrap: Corn, soy harvests in line with projections

 

 

The US corn and soy harvest pace is moving along as scheduled, the US Department of Agriculture (USDA) said Monday (October 29) afternoon in its weekly crop progress report.

 

Winter wheat planting and emergence continues to lag its average pace, but delays are not seen as a factor at this point, analysts said. Winter wheat crop ratings may raise a few concerns, as traders will keep a close eye on dryness issues in parts of winter wheat areas, analysts added.

 

Corn

 

The USDA said 73 percent of the corn crop was harvested as of October 28, up from 65 percent last year and the five-year average of 69 percent. Analysts had expected the harvest to be 70 percent to 75 percent complete.

 

The US harvest data were within trade expectations, but areas in the northwestern Corn Belt are showing delays, said Shawn McCambridge, senior grains analyst with Prudential Financial in Chicago.

 

Nevertheless, the last round of showers in the northwestern corn belt did increase a since of urgency for producers to get crops combined, he added

 

In Iowa, 63 percent of the crop was harvested, just below last year's 64 percent and the five-year average of 68 percent. In South Dakota, 50 percent of the crop was harvested, below last year's 56 percent and the five-year average of 55 percent.

 

However, Iowa and South Dakota harvest progress should be able to catch up this week, McCambridge said. If rain were forecast then there would be a concern, but realistically, the overall US harvest pace should approach 90 percent by next week, he added.

 

In Illinois, 95 percent of the crop was harvested, up from 82 percent in 2006 and the five-year average of 85 percent. In Indiana, 81 percent of the crop was harvested, up from 47 percent last year and the five-year average of 65 percent.

 

 Soy

 

The USDA reported that 84 percent of the US crop was harvested as of Sunday, up from the 82 percent last year, but just shy of the five-year average of 85 percent. Analysts had expected the harvest to be 80 percent to 85 percent complete.

 

In Iowa, 88 percent of the crop has been harvested, compared to 94 percent last year and the average of 97 percent.

 

Overall the harvest numbers don't strike any significant concerns, but Iowa remains behind a bit, and the trade will have to keep a close eye on cold weather, said Mike Zuzolo, senior analyst with Risk Management Commodities Inc. in Lafayette, Indiana.

 

The market must be watchful of a hard freeze, as that could produce field losses from pods shattering if temperatures fall below freezing for more than a few hours, he added.

 

Nevertheless, weather conditions look favourable for active harvesting across the Midwest this week, providing good opportunities for producers to make some good progress, he said.

 

In Illinois, 95 percent of the crop has been harvested, above the 87 percent combined last year and the average of 90 percent. In Minnesota, 93 percent of the crop was harvested, compared to 99 percent last year and the average of 95 percent. In Indiana, the cutting pace was 91 percent complete, compared to 69 percent in 2006 and the average of 85 percent.

 

 Winter wheat

 

The USDA said 88 percent of the winter wheat crop was planted, down from 90 percent last year and the five-year average of 90 percent.

 

Despite recent rain in the hard red winter wheat belt, farmers made good progress in the past week, with drier outlooks for this week allowing for producers to catch up, said McCambridge.

 

The USDA said 91 percent of the Kansas' hard red winter wheat crop was planted, down from 96 percent in 2006 and the five-year average of 94 percent.

 

The USDA reported that 70 percent of the winter wheat crop has emerged, just below the 71 percent in 2006 and the average of 64 percent.

 

In Kansas, 73 percent of the crop has emerged, compared to the average of 78 percent. In Indiana, 82 percent of the crop has emerged, up from last week's 56 percent and above the average of 57 percent. In Ohio, 93 percent of the crop has emerged, up from 64 percent last week and above the average of 60 percent.

 

"The report shows strong germination occurred last week, particularly in the Ohio River Valley, with good emergence from recent rains seen in the soft wheat areas of Ohio and Indiana," McCambridge said.

 

In Oklahoma, 63 percent of the crop has emerged, compared to the average of 79 percent.

 

"While Kansas and Colorado have managed to catch up a bit in emergence, Oklahoma remains 16 percentage points behind the average, and that may garner some attention, as it illustrates the market must continue to watch dryness in parts of the winter wheat belt," Zuzolo said.

 

Otherwise, crop ratings may draw some concerns, but fall ratings don't have a good correlation with final yields, McCambridge said.

 

However, the Pacific Northwest and the US Southwest are showing signs of stress due to dry weather and may provide some limited underlying concerns, he added.

 

The USDA said 55 percent of the winter wheat crop was rated in good-to-excellent condition as of October 28, down from last year's rating of 60 percent. Twelve percent of the crop is rated in poor-to-very poor condition, and 33 percent of the crop is rated in fair condition.

 

In Kansas, 62 percent of the crop is rated good to excellent, 43 percent of Oklahoma's crop is rated in good-to-excellent condition and Texas' wheat crop is rated 29 percent good to excellent. Illinois' and Ohio's winter wheat crops were rated 67 percent and 86 percent good to excellent, respectively.