Corn yields headed for 5-year low, some say
While corn futures have tumbled from an all-time high near $8 in June, prices recently spiked up again as the Midwest heat wave intensified. In late trading Aug. 5, December corn futures, which reflect expectations for the upcoming harvest, fell 3 ¼ cents to $6.98 ¼. On Aug. 2, the price closed at $7.15 ¾, the highest settlement for a December contract since July 2008.
The heat wave compounded difficulties for many farmers who, because of the wet spring, were unable to plant corn until May or June, past the ideal seeding date. Extreme heat during the day causes corn leaves to curl, limiting the plant’s ability to absorb sunlight, while high night-time temperatures lead to additional problems, hampering the transfer of pollen from the plant’s tassels to the silks, according to agronomists.
click image to zoomDuring a tour of Midwest cropland the first week of August, Doane Advisory Services analysts Marty Foreman and Bill Nelson saw several instances where extreme heat appeared to be hurting development of corn. This photo shows incomplete kernel fill on ears from a field near Dunlap in west-central Iowa Anecdotal reports of such problems have increasingly popped up. During a crop tour of the Midwest, Doane Advisory Services analysts Marty Foreman and Bill Nelson noted “disappointing ear fill” in a corn field near Bloomington, Ill., according to an Aug. 2 Twitter post from the tour.
Corn in central Illinois was “worse than expected,” the analysts said.
Two smaller than average ears with incomplete kernel filling from a field in Tazewell County in Illinois are displayed next to a better-developed ear found by Doane analysts Marty Foreman and Bill Nelson during a crop tour of the Midwest. While the USDA’s Aug. 11 report is widely anticipated in the grain market, the full story of this year’s crop may not be known for several months, some analysts say. Rich Feltes, vice president of research for R.J. O’Brien & Associates in Chicago, said he doubted any production estimates this month will resolve uncertainty over the crop size
“For the near term… U.S. weather extremes to date will undermine trade confidence” in the USDA’s August report, Feltes wrote in reports earlier this week. Agricultural markets are “focused like a laser beam on August weather.”