Pre-September US Crop/S&D Ideas - Late Season Midwest Dryness & Iowa Derecho Drop 2020 Crop Yields

Market Analysis

The USDA’s upcoming crop & supply/demand updates on September 11 will be closely watched. This year’s season long Drought and Derecho in Iowa, August dryness in parts of ECB & declining US crop ratings has the trade expecting a decline in the size of US corn & soybean crops. Our C. Illinois and the Midwest Crop Tour’s field checks revealed reduced pod and ear counts verse the tour’s 2018 levels (SD and MN were the exceptions). This suggests that the USDA’s August 181.8 and 53.3 bu US corn & soybean yields can be reduced. The USDA resurvey of Iowa’s harvested area is likely to reveal 250-300,000 in lost corn acres from last month’s Derecho that crossed Central Iowa leaving many fields flat and unharvestable. (CORN, SOYB)

In corn, 2020’s tour yield checks were strong in 4 states (IN, IL, SD, & MN) while the other 3 states (IA, OH & NE) were lower than expected. This year’s reduced ear counts vs 2018, no USDA enumerator plot data information until this report, and continued heat & dryness except for a few ECB spots has the trade expecting a lower US September yield. Specifically, Iowa’s and Illinois’s yields could drop by 10 & 5 bu. This could reduce both the WCB’s & ECB’s regional averages by 5.3 & 4.5 bushels to 184.3 and 185.9, respectively. With little change in the southern US, September’s national corn yield could decline to 177.7 bu, reducing 2020’s crop by 403 million bu. to 14.875 billion bu. on 300,000 lower harvested area. 2020/21 stocks could also drop to 2.458 billion bu. with some old-crop exports & new-crop feed demand slippage.

In soybeans, the tour also revealed lower pod numbers vs. 2018 levels except in SD & MN. With above normal temps & below normal August rainfall in the Central US, this month’s US bean yield could drop 1.8 bu. to 51.5 bu. with 2.2 and 1.9 lower yields in the ECB & WCB. Overall, 2020’s US output could drop by 150 million to 4.275 billion bu. With 10 million higher old-crop crush & no change in new-crop demand levels, 2020/21’s stocks could drop to 450 million bu.

1 2
View single page >> |

Disclaimer: The information contained in this report reflects the opinion of the author and should not be interpreted in any way to represent the thoughts of any futures brokerage firm or its ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.