Today’s Prices
Grain markets finished sharply higher as got friendly news from the USDA yesterday including lower crop ratings and higher prevented plant acreage.
Grain Market News
U.S. Corn Crop Condition
Our ratings fell 2% down to 55% good to excellent which compares to 57% last week and 60% last year.
Not only are crop conditions below last year they are below average and therefore this would hint at U.S. yields being below trend.
But before we get overly bullish keep in mind this year’s trend line yield is 181, USDA lowered that to 177 in May based on late planting then lowered it further to 175.4.
So, USDA is already projecting a yield that is 5-6 bushels per acre below trend.
Corn- Change in G/E
Only 3 states showed signs of improvement with Minnesota up 1, Missouri up 3, and Ohio up 2.
We thought that Iowa would be up from last week’s rains, but Iowa held unchanged, and Illinois fell 3% and that contributed to the 2% decline in nationwide ratings.
U.S. Soybean Crop Conditions
Soybeans dropped 1% from 58 to 57% good to excellent that compares to 56% last year.
The soybean rating is below the long-term trend but keep in mind that line also includes the drought year of 2012.
When you look at the bulk of crop years we are at the lower end of the range and USDA is projecting a yield above trend.
Trend line yield is 51.5 bushels per acres and USDA is projecting 51.9.
Soybeans- Change in G/E
Only 5 states improved and some of those states like North Carolina, Missouri, and Kentucky are not major states.
It was a surprise to see Iowa was down 1%, Illinois down 1, and when you combine that with all the other states that declined the U.S. rating did fall.
Prevented Plant Acres
The prevented plant acres came out in the FSA acreage data yesterday.
This chart shows prevented plant for just corn, beans, and wheat.
Corn, beans, and wheat at 5.3 million acres versus 1.3 last year.
Corn, bean, and wheat prevented plant is up 4 million acres from last year.
We believe a lot of traders are an anticipating they would be up a couple million from last year.
The fact they were up 4 hints that in the October crop report, USDA may be forced to lower acreage further.
U.S. Prevented Plant Acres
On average for about the last 15-year corn, bean, and wheat account for about 86% of prevent plant.
This year corn, beans, and wheat account for 83.
Pro Farmer Crop Tour-Corn
USDA in the august crop report estimated that Ohio yield would be down 2% from last year’s august estimate.
Pro farmer at 174.2 is down 6% from last years estimate.
That was considered lightly supportive for the Ohio corn yield. In South Dakota USDA came in at 147 versus last year at 133, up 11% for South Dakota.
In tonight’s report, pro farmer will report on Indiana and Nebraska yield.
Corn/Soybeans Pro Farmer Tour History
If we take an 11-year average on soybeans its 46 bushels per acre versus USDA in the August crop report averaging 46.4.
Therefore, historically pro farmer comes in 4.10 of a bushel below USDA crop report for soybeans.
Corn, USDA estimated a yield at 175.4 in august and on average over the past 11-year pro farmers averaging 3 bushels per acre below USDA’s estimate.
Grain Market News
September Corn Chart
Corn had a very impressive day with the market moving sharply higher and closing sharply higher as well.
We have very nice chart patterns developing where we have consistently higher highs and consistently higher lows.
Chart and technical indicators pointed up.
The next level of overhead resistance is 6.82 spike lows from June.
September Soybean Chart
Soybean prices took out the highs posted earlier this month at 14.64, that keeps the uptrend intact.
The higher trend in beans combined with technical indicators tells us there is no sign of topping action.
The next level of overhead would be 14.89 and that’s about 25 cents above where we closed today.
September KC Wheat Chart
Wheat prices look very good, this market has rallied 87 cents since last Thursday’s low.
We are now challenging the highs from August which places 9.21 at the next target. That’s almost 40 cents above where we closed today.
Following the rally, the last 3 days the wheat chart looks good and technical indicators look good.
Questions or Comments
