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July 15, 2008
Marketing Decisions Can Be Based On Weather Data, If You Watch Those Weekly Crop Condition Reports
High demand of grain for feed, export, and biofuel use dance with the uncertain size of 2008 crops because of late planting, flooding, and other natural phenomena that will create question marks about crop size well into harvest. But would those weekly planting progress reports issued by USDA help with estimates of production, if compared to weather models?
University of Illinois agricultural economists Darrel Good and Scott Irwin, along with weather specialist Mike Tannura have evaluated the new crop yield potential for Illinois, Iowa, and Indiana using previously developed weather models. Their research adjusts the trend yield with the weather variables to project a state average yield.
Planting dates are important, and over the past 40 years it has been moved up by 2 weeks with a resulting positive yield response. While there is little difference in when crops are planted before a certain date, the yield falls significantly if planting occurs after that date. In a recent study of planting dates and weather variables, earlier planting was found to be the dominant reason for higher yields in the northern and western Cornbelt. The researchers looked through the weekly USDA statistics back through 1979 and analyzed the dates planting progress reached 50% complete vis-à-vis May 1. Despite variations, they confirmed the trend toward earlier planting, which was 20 days earlier for corn and 10 days earlier for beans than in 1960. The researchers also looked at the lateness of planting in given years to evaluate yield penalty, the amount of delays, and the impact of weather.
Interestingly, Good, Irwin, and Tannura found that the optimum precipitation in May was zero. They say while that seems unrealistic, the converse of too much rain means planting delays and lower yields. Late planting in Iowa and Illinois were frequently linked, but not between Iowa and Indiana, reflecting the variability in weather patterns. Another finding was that it is impossible to break down the trend yield into its dynamic components of plant modification, management and environmental changes. Their models explained 95% of the variation in corn yields for the three states and about 90% of the variation in soybean yields for the three states.
Among the findings:
1) Relative to average levels, corn yields in 2008 are estimated to drop 2.9, bushels per acre in Illinois, 3.5 bushels per acre in Indiana, and 6.3 bushels per acre in Iowa, due to May precipitation and late plantings.
2) Relative to average levels, soybean yields in 2008 are estimated to drop 1.1, bushels per acre in Illinois, 0.4, bushels per acre in Indiana, and 1.0 bushels per acre in Iowa due to May precipitation and late plantings.
3) The magnitude of the yield declines due to slow planting progress in 2008 are relatively small due to the fact that May precipitation, while high, was not extremely high, and the magnitude of late planting, while above average, was considerably less than previous highs.
4) It is important to keep in mind that these estimates do not take into account the impact of replanting due to flooding in some areas of Illinois, Indiana, and especially, Iowa during June 2008.
To estimate yields, based on observations of good to excellent percentages of the corn and soybean crops, the researchers developed formulas to modify the trend-adjusted yields. The formula incorporates weather through June and assumes average weather in July and August and forecasts based on crop condition ratings at the end on June. Applying the formulas to the crop conditions as of June 29, they project yields of 152.4 bushels per acre for corn and 42.9 bushels per acre for soybeans. While other models have a 33 bushel range for corn and an 8 bushel range for soybeans, the Illinois crop weather model is remarkably close to current production estimates.
The researchers say estimates of total production have to be weighed against the uncertainty of harvested acreage, remaining summer weather, and the statistical errors in the crop weather model.
Summary:
Earlier planting dates have contributed to increasingly larger corn and soybean yields in the Cornbelt, but weather can also explain about 90% of the yield variability. A study of planting dates and May precipitation found statistically relevant yield impacts for 2008 for corn and soybeans in Illinois, Iowa, and Indiana. That information, combined with crop condition ratings at the end of June and average July and August weather, can predict state-based yield expectations with relative accuracy.
Posted by Stu Ellis at July 15, 2008 12:15 AM | Permalink
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