Update for October 6th, 2022
Falling Mississippi River Levels & Results from a Farmer Yield Survey
The next USDA report seems like it is always right around the corner and while last week’s USDA report brought on a lot of price action in corn and soybeans, attention has quickly turned to the Oct report which will be out next week. Worksheet including Sept 30th numbers shown here:
StoneX conducted a farmer yield and production survey which was released this week. Results from the survey forecast a U.S. corn yield of 173.9 bushels per acre which is an increase vs the September forecast of 173.2. Overall production totals were also adjusted from 14.168 billion bushels in September down to 14.056 billion bushels.
The StoneX U.S. soybean yield results came in at 51.3 bushels per acre and total production of 4.442 billion bushels. This updated yield is half a bushel below the September estimate of 51.8 bushels per acre. Total production was also lowered from the September estimate of 4.515 billion bushels.
The map below contains the results from the farmer survey by state and crop.
The Mighty Mississippi River water levels are falling which is limiting the barge traffic. Reuters reported that commercial barge traffic along the southern portions of the river were actually at a standstill due to low water levels. Close to 100 tow boats and 1,600 barges were backed up for miles waiting to make their way through one of the problematic stretches in Louisiana this week. Some areas along the river have also been closed at times. The U.S. Army Corp of Engineers is working to dredge the river in some of these areas. Some exporters have started to pull their Gulf offers for corn and soybeans that are scheduled to be loaded October and November because of the uncertainty of being able to move grain down the river. Like one exporter explained “We can’t commit to new sales right now”.
Forecasts for next week don’t show any major rain events to help with the low water levels. The GFS has some potential precipitation around October 15th for portions of Iowa, Illinois and Missouri.
Since the water levels are so low draft and tow restrictions have been implemented all of which are pushing barge rates to record highs. The USDA noted in its weekly grain transportation report, “The tight barge supply is problematic for grain shippers heading into harvest…(increased demand) will likely put even more upward pressure on barge rates.” So, while it is difficult to move grain to the Gulf ports it is also difficult for fertilizer shipments to move upriver. This has caused concern regarding availability and pricing.
Say goodbye to our Indian Summer. A cold front that has dropped temperatures will be hanging around for a few days. By tomorrow morning wind chills will drop to the upper 20’s in northern areas of the region.
The wind is expected to quiet down by Friday evening. Along with calm winds, skies are expected to be clear and the air quite dry Friday night a perfect recipe for frost and freezing temperatures. This means that Saturday will be the coldest day we have seen in months. The map below shows the max temps for Saturday.
Following the frosty morning the rest of Saturday is expected to remain chilly with highs only reaching the mid and upper 50’s. Sunday is forecast to be a sunny day and with a return flow temps should make it back to the 60’s and warmer temps once again for next week. The graph shows temps for Davenport, IA but gives an indication of what other areas can look forward to.
Next week forecasts offer little chance of precipitation but models agree that a strong system is possible mid-October. Temps may be low enough that some parts of the Midwest could even see a few snowflakes. Weather models’ accuracy decreases with the length of time involved so the following map is certainly not a sure thing but the EURO model shown below is the temperature departure from normal for October 17th. Readings in Iowa are expected to be around 20 degrees cooler than normal and parts of Colorado could see temps 42 degrees below normal. There is a chance of minor snowfall accumulations as seen in the second map but that remains to be seen.