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July 29, 2009

Are Your Crops Developing As Slowly As They Are Everywhere Else?

Four months into the primary Cornbelt growing season, but do crops show four months of maturity? USDA’s weekly crop condition report indicates the majority of corn and soybeans are in good to excellent condition, but many farmers are wondering whether the crop or Jack Frost will be first at the finish line.

USDA’s July 28th Weekly Weather and Crop Bulletin indicates that crops have a lot of growing to do in a short period of time, and maturity must be reached in the next two months without concerns of weather risk and market volatility. From the “eye in the sky” view there are many states that are well behind the norm on crop development.

ILLINOIS: Corn is 53% tasseled, compared to 76% at this time in 2008 and the five year average of 93%. Current conditions are 62% in good to excellent, but 27% is rated as fair. The soybean crop is setting pods in only 9%, compared to 14% last year and 39% for the five year average. Soybean conditions are rated as 61% in good to excellent condition with 29% rated as fair. The 70ºF statewide average temperature for July has held back the oat crop, which is more than 10% delayed in turning yellow compared to average maturity, and only 10% of the alfalfa is in its third cutting, which by now would have 23% in a third cutting. Soil moisture is 94% adequate to surplus, but the cool temperatures are nearly 6º below normal, setting 2009 up as the coolest July on record.

INDIANA: 53% of the corn is silked, compared to 64% last year and 84% for the five year average. 2% is in the dough stage, compared to 16% for this typical time of year. 63% of the corn is in good to excellent condition with 28% in fair condition. 51% of the soybeans are blooming, about the same as 2008, but behind the 71% expected for this time of year. Typically 27% would be setting pods, but only 7% currently are doing that. 64% of the beans are in good to excellent condition, with 26% listed as fair. 83% of the alfalfa has had a second cutting, about average for the recent and longer term. Indiana temperatures have ranged from 4 to 11 degrees below normal, slowing growth and development of major field crops.

IOWA: The corn crop generally ahead of 2008, but behind the five year average. Specifically, 78% has tasseled, compared to the five year average of 88%, 60% of it has silked, compared to the 74% average, and 7% is in the milk stage, versus the 21% five year average. 80% of the corn is listed in good to excellent and only 15% as fair. 81% of the soybeans are blooming, which is comparable to the five year average of 84%; and 35% are setting pods, which is behind the 46% five year average. 79% of the beans are rated good to excellent. Iowa crop reporters indicated that some area of the state have not had any measurable rainfall for two weeks, but the cooler than average weekly temperatures have kept crop conditions at high levels. Topsoil moisture was rated 82% adequate and 10% surplus.

KANSAS: The sunflower crop is on schedule for emergence and blooming, with 74% in good to excellent condition. The second cutting of alfalfa is also on schedule, but the third cutting is slightly behind. Topsoil moisture is 77% adequate and subsoil is slightly better. Forage supplies are in good shape and 66% of the range and pasture are good to excellent.

MICHIGAN: The corn crop averages 55 inches, and tasseling is variable throughout the state. Corn and soybeans benefitted from moisture, but both crops are not as tall as they should be by this time. Winter wheat is rated 70% good to excellent and harvest is underway; but the oat crop is rated slightly less and is reported all headed. Recent rains were needed and, “growers welcomed much needed rainfall. Some areas of State remained dry. Most crop conditions improved with recent rainfall; however crop development remained behind normal due to cool temperatures. Growers continued to report need for warmer temperatures to advance crop development.”

MINNESOTA: Corn is beginning to enter the milk stage, which is slightly ahead of 2008, but behind the five year average. Winter wheat harvest is just beginning. Spring wheat is 24% ripe, which is behind the five year average of 61%, but none is harvested. Both the oat and barley crops are behind the five year average, as well. Less than 60% of the canola and sunflower crops are rated good to excellent. The topsoil is 43% short to very short, and moisture supplies are declining.

MISSOURI: While moisture is 81% adequate for crops, coolness prevails and temperatures were 4 to 8 degrees below normal across the state in the past week. The Missouri climatologist reported last week that July should set a record for being the coolest on record. Hay cuttings are on schedule, and pastures are rated 66% good to excellent.

NEBRASKA: Corn maturity is better than 2008, but slightly behind the five year average with 77% silked and 8% in the dough stage. Between dryland and irrigated corn, the crop is rated 79% good to excellent. Soybeans are also rated 82% good to excellent, with 75% blooming, which is comparable to the 5 year average. 24% of the beans are setting pods and that is slightly behind the 35% average for the past five years. The sorghum crop is in good shape and ahead of average. 99% of the wheat is ripe and 85% has been harvested which is slightly behind normal. Precipitation has been good with 82% of the topsoil having adequate to surplus moisture, but temperatures averaged 5 degrees below normal for the past week, some dipping into the 40’s.

NORTH DAKOTA: Better weather is being reported, “Near normal temperatures and below normal precipitation aided crop conditions in wet areas and hindered it in drier areas.
Observers in the central district reported that limited precipitation was negatively affecting crop development. However, reporters in the northeast commented that the dry, warm weather was beneficial for a variety of crops.” However, the development of the durum wheat crop, spring wheat crop, barley crop and oat crop are all slightly behind the five year average.

OHIO: The corn crop is rated72% good to excellent, but only 59% is tasseled and that is behind the 78% for the five year average. Soybeans are 66% in the good to excellent categories, but only 68% are blooming, and that is behind the 80% average for this time of year. The winter wheat is nearly all harvested, and that is on schedule. Topsoil moisture is rated 64% adequate and 25% short, which is also being reflected in conditions of the hay crop and pastures.

SOUTH DAKOTA: Cooler weather has given way to warmer temperatures, and “Warmer, drier weather helped with row crop development, harvesting of small grains and cutting of alfalfa; but insects are now becoming a hindrance for both crops and livestock.” The corn crop is 36% tasseled, compared to the five year average of 68%. The sunflower crop is on par with prior years. The winter wheat crop development is marginally behind schedule, as are barley, oats and spring wheat. Better than half of the topsoil has adequate moisture, but nearly a quarter of the topsoil and subsoil are short of moisture.

WISCONSIN: Coolness also prevails, with “Average high temperatures ranged from 76 to 80 degrees across the state. Lows averaged from 52 to 61 degrees for the week. Average temperatures were below average again, and the lack of heat units has many crops behind five-year averages.” The corn crop averages 68 inches in height, with 21% silking. 42% of the soybeans are blooming and 9% are setting pods.

Summary:
In only rare instances are 2009 crops developing in line with the five year average, and in most cases, corn and soybean crop stages are 20% behind the five year average. Many small grains are also behind in their development, but not as much. Nearly all state reports have indicated the problems stem from cooler than normal temperatures, hampering expected crop development.

Stu Ellis

Posted by Stu Ellis at July 29, 2009 12:21 AM | Permalink

Comments

Don’t plan on spending your crop insurance (CRC or RA) indemnity just yet. It may not be coming.

$ 4.04 Corn Spring Price
---------------------Coverage Election Selected
Fall Price-----------85% 80% 75% 70% 65%
----------------% APH for Insurance Indemnity Trigger
$ 3.00 ------------114% 108% 101% 94% 88%
$ 3.10 ------------111% 104% 98% 91% 85%
$ 3.20 ------------107% 101% 95% 88% 82%
$ 3.30 ------------104% 98% 92% 86% 80%
$ 3.40 ------------101% 95% 89% 83% 77%
$ 3.50 -------------98% 92% 87% 81% 75%
$ 3.60 -------------95% 90% 84% 79% 73%
$ 3.70 -------------93% 87% 82% 76% 71%
$ 3.80 -------------90% 85% 80% 74% 69%
$ 3.90 -------------88% 83% 78% 73% 67%
$ 4.00 -------------86% 81% 76% 71% 66%

$ 8.80 Soybean Spring Price CRC or RA with Harvest Option
---------------------Coverage Election Selected
Fall Price-----------85% 80% 75% 70% 65%
----------------% APH for Insurance Indemnity Trigger
$ 8.00 ------------94% 88% 83% 77% 72%
$ 8.25 ------------91% 85% 80% 75% 69%
$ 8.50 ------------88% 83% 78% 72% 67%
$ 8.75 ------------85% 80% 75% 70% 65%
$ 9.00 ------------85% 80% 75% 70% 65%
$ 9.25 ------------85% 80% 75% 70% 65%
$ 9.50 ------------85% 80% 75% 70% 65%
$ 9.75 ------------85% 80% 75% 70% 65%
$ 10.00 -----------85% 80% 75% 70% 65%
$ 10.25 -----------85% 80% 75% 70% 65%
$ 10.50 -----------85% 80% 75% 70% 65%

$ 8.80 Spring Soybean Price RA No Harvest Options
---------------------Coverage Election Selected
Fall Price-----------85% 80% 75% 70% 65%
----------------% APH for Insurance Indemnity Trigger
$ 8.00 ------------94% 88% 83% 77% 72%
$ 8.25 ------------91% 85% 80% 75% 69%
$ 8.50 ------------88% 83% 78% 72% 67%
$ 8.75 ------------85% 80% 75% 70% 65%
$ 9.00 ------------83% 78% 73% 68% 64%
$ 9.25 ------------81% 76% 71% 67% 62%
$ 9.50 ------------79% 74% 69% 65% 60%
$ 9.75 ------------77% 72% 68% 63% 59%
$ 10.00 -----------75% 70% 66% 62% 57%
$ 10.25 -----------73% 69% 64% 60% 56%
$ 10.50 -----------71% 67% 63% 59% 54%

Revenue bases crop insuance can be useful risk management tools. They pay when actual farm revenue is below the guarantee. The guarantee is APH (Actual Production History of the farm or unit (Average of up to ten (10) years of actual farm production)) times the spring insurance price (or the higher of the spring or fall price when CRC is purchased or the Harvest Option is selected with RA) times coverage election selected at time of insurance purchase. When the actual farm revenue (Fall Price times Farm (unit) Yield) is below the guarantee an indemnity is paid for the difference.

The chart is an attempt at illustrating the farm yields needed to trigger an indemnity payment at various fall prices. If seventy five percent (75%) coverage was purchased on a corn crop and the fall price comes in at $3.30 per bushel, the farm yield would need to be below 92% of APH to trigger an insurance payment. So if the farm’s APH were 157 bushels per acre the yield needs to be below (92% X 157) 144 bushel per acre to “trigger” an insurance payment. With many folks expecting good yields, the insurance payments may not be there, especially in the western corn belt.

Posted by: Freeport, IL at July 30, 2009 10:24 AM

I know that the tree's here have started changing color and some leaves have already started falling. If you want a theory that fits what is going on better than most you have heard before, I recomend the book, "The Chilling Stars" by Henrik Svensmark. In it he puts forth the evedence for the theory he calls "cosmoclimatology" where the sun influences cosmic rays which influence clouds. for the last few years the sun has been very quiet allowing in more cosmic rays, and the cloud cover has gone up.

Posted by: Matthew Boyd at July 30, 2009 4:59 PM

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