USDA Report Worksheet and Outlook Plus U.S. Crop Progress
Update for June 27th, 2019
This week’s Crop Progress report showed a 4% increase in planted corn acres bringing the total for the season to 96% complete. The state of Ohio is the furthest behind with 20% left to plant followed by; Indiana and Michigan 9% each; Illinois and Missouri 8% each; Wisconsin 7%; Colorado and South Dakota 5% each. Corn listed as emerged indicates that the states of Illinois, Indiana, Michigan, Missouri, Ohio, South Dakota and Wisconsin are lagging furthest behind with development. The corn crop condition slid this week with the Good to Excellent category falling from 59% a week ago to 56% this week, far off from last year’s G/E rating of 77%.
Exceptionally slow planting progress and plant emergence was reported this week for the U.S. soybean crop as well. Planting progress increased from 77% to 85% this week but is far off the 5 year average of 97% completed by this date. Ohio has 35% of their soybean acres left to planted; Indiana 25%; Illinois and Michigan both have 21% unplanted; Kansas and South Dakota each have 16% unplanted and they are not alone as many other states are reporting significant percentages of unplanted soybean acres. Emergence is currently sits at 71% which is 20% off the 5 year average of 91%.
So how does NASS (USDA National Ag Statistics Service) receive the data presented in the weekly Crop Progress report? Unlike other reports from NASS the Crop Progress report is not based off from farmer surveys, instead they use data obtained from county observations made by County Extension agents and FSA employees and their conversations with the producers they work with. The goal of the agency is to get a report every week from every county relevant to each particular crop. This practice averages well over 2,000 reports every Monday morning.
Tomorrow, June 28th at 11:00 am CST the USDA will give us their latest acreage and quarterly stocks estimates. Considering the survey was done in late May and early June much of the data is inaccurate when you take into account the enormous number of unplanted acres and acres that need to be replanted that no one, at that time, had planned on. A recent survey by Bloomberg showed that most traders are thinking that the USDA could cut the number of planted corn acres down again to around 87 million. This would put harvested acres down below 80 million. Another survey of nearly 2,000 producers representing 6 million acres suggests a reduction of corn acres closer to 85 million may be more suitable. The USDA has decided to allow corn planted for silage to count as “cover crop” on prevent plant acres. This could distort the planted acreage number as being higher than it really is but when everything is said and done those acres will not be included in the final count of harvested acres.
Trading on Friday is likely to be quite active as the government numbers are processed and traders prepare for the end of the 2nd quarter. Export sales for corn are still near the USDA estimates thanks to strong demand in the early season. Since then though the implementation of Chinese tariffs have tanked new corn sales and soybean sales have now fallen below the pace needed to reach the USDA forecast. Many analysts and traders agree that we are likely to see a record large U.S. June bean stocks number that will still be record large even when harvest starts.
The G20 Summit is being held in Japan today and tomorrow and as we’ve heard President Trump and Chinese President Xi Jinping have scheduled a meeting while there to work on completing a trade deal. U.S. Treasury Secretary Steven Mnuchin told CNBC during an interview that the U.S.-China trade deal is around 90% complete. He stated that he expects progress will be made during the G20 Summit but did not speculate on a timeline for completion.
The 5-day forecast shows 2-3 inches of rain are possible across southern Minnesota and central Wisconsin.
The National Weather Service is forecasting a return to wetter conditions with above-average precipitation expected in both the 6-10 day and 8-14 day outlooks.
Some above-average temperature are on the way for the Midwest this weekend and are expected to last through the first week of July.