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Normal frost date is vital for fall crop developmentBy Doug Rich 
The Aug. 12 crop report released by the U.S. Department of Agriculture and the National Agriculture Statistics Service reported that corn production is down 6 percent from 2007, soybean production is up 15 percent from last year, and all wheat production is unchanged from the July forecast. Corn production was forecast at 12.3 billion bushels with an average yield based on August 1 conditions of 155 bushels per acre. Soybean production is forecast at 2.97 billion bushels with an expected average yield of 40.5 bushels per acre. All wheat production is 2.46 billion bushels with an average yield of 43.5 bushels per acre. At a CME Group press conference following the release of the USDA Crop Production report, Richard Feltes with MF Global said the corn crop has survived a slow start but there is still some uncertainty associated with this crop. "The people that I have spoken to who have actually been out looking at the crops said their view of the crops are dramatically different from these yield forecasts," Feltes said. "They are much more cautious, much more conservative, not only because of the delayed development but because of the variability of the crop." Feltes said we are still very early in the cycle with this delayed crop and there is still a lot of uncertainty. A later than normal frost date would improve the yield potential of this crop in the absence of any moisture stress. Feltes compared this crop to those in 1990 and 1992 that rebounded from a wet, cool spring thanks to a later than normal frost date. "I think the weather forecast is as important as anything this morning," Feltes said. Dan Basse with AgResource Company said the current crop report was based on a beauty contest because NASS did not have many ears to count. They are still not counting test weight which tends to be on the light side in late development years like this one. "We need an extended growing season," Basse said. "I believe the September report will be larger than this report in terms of its yield analysis but when combines start rolling and the crop is not there it could start a rally phase similar to last year." At the present time there are no ominous cool air pools forming over Canada which is good news for normal fall weather. Basse said that normal summer temperatures usually suggest normal autumn frost dates. Iowa had normal July temperatures. "Predicting a frost is worse than predicting a drought," Feltes said. Basse pointed out that global grain stocks, including corn, soybeans, and wheat, are only up 11 million metric tons. In other bull markets like this one with the need to build supply and acreage we would see global grain stocks up near 50 or 60 million metric tons, according to Basse. "The world is not awash in grain," Basse said. "If there is some kind of supply abnormality there is not a lot of supply cushion left."
Doug Rich can be reached by phone at 785-749-5304 or by e-mail at richhpj@aol.com.
8/18/08 Date: 8/14/08
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