The weather has been too wet for early planting, especially affecting the corn market, since corn is planted first. The delay in planting and forecast for more rain has been causing corn prices to go up.
There is a USDA report out at 11am on Friday, May 10th at 11am!
Friday Weather-drier in week 2 on Euro ensemble-06Z GFS operational
Saturday Weather-drier again
Weather Sunday:-Turning pretty dry late this week for a week-a bit less rain with this weeks event too
Weather Monday:-Drier in the 6-10 day not new now-wetter again late week 2??
Tuesday Weather: Same as Monday but rains returning in week 2, when will that be??
Sunday Weather: Warmer!
The ideal time frame for planting corn is the next 2 weeks. The market will be scrutinizing the 2 week forecasts every day.
This operational GFS model product is updated every 12 hours. The GFS is updated every 6 hours.
When is the best time to plant corn?
Figure 1. Adjusted gross income responses to planting dates in the central, north-central and northern Corn Belt over 18 years
What about soil temperatures?
A Pioneer study on SE showed that hybrids with higher SE had better stand establishment than those with lower SE in cold soils. (Figure 2).
Figure 2. Average stand establishment for high and low SE hybrids in 6 emergence locations.
Crop progress report from Monday:
Corn 15% vs 27% average
Beans 3% vs 6% average
HRS 13% vs 33% average
Winter wheat 64% gd/Ex vs 62%
Planting delayed states in corn:
Illinois 9% planted (5yr avg 43%)
Indiana 2% (5yr 17%)
Minnesota 2% (5yr 24%)
Ohio 2% (13%)
Minnesota 2% (33%)
N. Dakota 5% (21%)
S. Dakota 8% (60%)
Montana 23% (34%)
National corn planting progress (since 1987) on April 28
So is this the slowest ever(2013)? That depends on how you judge “slowest.” We’ve always shown 1993 as the slowest year, primarily because it got started so slowly, with less than 10% of acres planted by the end of April. Like this year, producers caught up some in mid-May 1993, planting 53% of the acres between May 5 and May 19 of that year.
But there are a number of years that had a lower percentage of acres planted by week 21, which this year corresponds to May 26. Only 71% of acres were planted by this week in 1995, and only 78% were planted in 1996. Only 82% were planted by now in 2009.
The national average yield in 1995 was 13.2 bu. below trend. For 1996, the yield got within 1.5 bu. of trend, while 2009 saw the current record corn yield of 164.7 bu./acre. That was 11.9 bu./acre above the 1960-present trend, and 8 bu./acre larger than the 1996-present “biotech era” trend.
Export sales were poor:
By tjc - May 3, 2019, 11:22 a.m.
Cliff and MetMike
Here in LaSalle County, Illinois a few planted (for the first time) many days ago. Nearly all will, as the coffee shop says, plant again. 90% or more have not started, nor will they for most likely until after the 14th as more rain is predicted for Mon-Wed.
That being said, the funds are NOT one contract scared enough to short cover.
MetMike, you have chronicled many weather events. HOW desperate is it going to have to get to start short covering.
I bought relatively cheap calls expiring today convinced a 20 cent corn and 30-40 cent bean EXIT would commence by Wednesday. Wrong! (No doubt it commences Sunday night!)
By metmike - May 3, 2019, 11:48 a.m.
Great to read you again tjc,
If not for the weather, corn fundamentals are horrible.
Exports have been poor(dollar pretty strong is hurting those to) the USDA has been increasing stocks and planted acres were projected to be massive.
The huge funds also have a record short position on, despite covering some of it this week.
So weather is the only chance we have here and its potentially very bullish but only if the wet weather continues for at least another 2 weeks.
You got a sample of what will happen if we come in here and the forecast suddenly turns drier. This morning spike lower at the open was the result of a couple of drier models a few hours earlier for the week 2 period.
If it would dry out in 2 weeks, planting will be late in many places but corn will still get planted.
If we go out farther than that(add another week) then we really start to lose corn acres. If we got thru the month of May and stay wet, corn acres plunge and it doesn't matter how bearish everything else is..........if you cut 4-5-6-7 million acres off of estimates for planted corn acres, the supply side suddenly goes from very bearish to bullish........until the market reconfigures prices.
If that would happen(IF) fund shorts of 300,000 contracts will cover. That's a lot of buying power and it would come with some extreme short term, hard to predict spurts.
Like, lets say next Monday, the forecast gets wetter. Funds could decide to buy 50,000+ contracts in a short period of time and they won't be waiting for the price to come down to resting orders.
If that happened, corn could have a double digit gain in 1 day. It's conceivable, if the weather got wet enough for long enough with this environment(big funds so short and leaning the wrong way) that we could have a limit up day.
This is not my prediction based on todays weather models, that are a bit drier in week 2 but I will say with high confidence, if week 2 turns excessively wet next week, the current price will be left the dust.
Another item. We have had a dozen planting delay scares in the past 3 decades. They were all temporary and all resolved at some point and as soon as a better planting weather forecast appeared, the market crashed quickly. We have bounced 20c on this with super bearish fundamentals. There is downside risk here, should the pattern turn more favorable for planting.
The day that happens and is seen to be likely, funds may pile on the short side........assuming we can still get most of the crop planted. If its too late to plant alot of the crop, when the weather finally dries out, prices will probably be closer to $4, depending on how many acres the market thinks were lost.
Another item. Things always look the most bullish at the top and the weather right now, if it represents the most bullish forecast we feed the market for the rest of the month..............then the top is going to end up being around here, for what turns out to be a weather scare.
Thank you for the detailed reply.
I do not want to come off as a coffee shop gossiper or poor looser when a trade does not materialize.
Corn 'may have' put in a daily and weekly low April 25 at depressed levels and low rsi, over sold stohs, etc. IF so, one would anticipate a 2-5 week rally FROM WHICH TO SELL a massive carryover and upcoming crop.
Bought the cycle, but it appears news has not (yet) produced a rally
Thanks for sharing and being real tjc!
The only reason for corn to go higher is if the weather stays wet for the month of May.
The forecast this morning is drier............but that can change again.
Follow up on more SIL Historical weather and GDU/Black Layer Data (30 year average)...NO need to make any hybrid x maturity decisions yet. PLENTY of time to plant
@StoneSeedIL LATE RM hybrids like 6542RIB/6622RIB/6712RIB and harvest by mid Oct - early Nov. Even if planted in June
For corn planted on May 20th(red) and June 5th(yellow) below
Started by cliff-e - May 3, 2019, 6:55 a.m
Mississippi Flooding 157 year high
Started by joj - May 4, 2019, 7:26 a.m.
What if this weather is the new normal ?
Started by mcfarmer - April 30, 2019, 8:40 p.m.
opening tonight grains
Started by bcb - May 5, 2019, 6:44 p.m.
By mcfarmer - May 6, 2019, 7:52 a.m.
It’s been wet here in NW Iowa.
We got to go Saturday and Sunday, worked nearly straight through. Sitting at about 1/3 planted now.
By mikempt - May 6, 2019, 9:24 a.m.
The Amish in Lancaster have the corn planted
By metmike - May 6, 2019, 11:45 a.m.
Thanks mike/mcfarm, IA, as noted yesterday is only too wet to plant along the west and east borders.
It's IL/IN/OH that are completely water logged and a looooooooong way from planting. MN is not quite as bad as the ECB but chilly temps are an additional issue there.
The planting progress number tonight is expected to be pretty bullish(falling farther behind) but that was mostly dialed in with last weeks rally.
The latest weather updates that turned drier, especially starting Saturday have traded this drier weather now long enough for it to be dialed in as we are looking for the new weather item..............what will happen later in week 2?
The latest models suggest that it will turn wet/bullish again, with rains increasing from the west(staying dry in the ECB thru 2 weeks)
Weekly crop progress from USDA:
Corn 23% planted vs 15% lw and 46% average
Beans 6% planted vs 3% lw and 14% average
HRS 22% planted vs 13% lw and 49% average
Cotton 18% planted vs 11% lw and 19% average
Again, its mainly 4 big states(5 with SD) that are waaaaaay behind:
In the ECB
IL 10% planted vs 66% average
IN 3% planted vs 35%
OH 2% planted vs 27%
MN 6% planted vs 42%
SD 0% planted vs 29% These last 2 states had the late snowstorm and cold weather(the ECB just heavy rains)
Iowa is 36% planted vs 51% average which is not a serious planting delay
CN had a tiny 1 tick gap higher on the open tonight(365 was the low of the open and 364.75 was the high on Monday).
I can guess that the slow planting progress in the Eastern COrnbelt was a bullish factor..........that only matters if the weather stays wet(its going to dry out).
We bounced up to just above the bottom of Friday's spike low on the day session open(366)and actually filled the gap lower from last night(getting to a high of 366.5 and 2.25c higher at 8pm. But that Friday low, which was support then, is acting now as resistance tonight.
This resistance held, so we went down and filled that tiny gap higher on tonights open and are now unch. for the trading session, 2c off the highs.
There is a USDA report out on Friday!
Final Plant Dates for Crop Insurance for
#corn and #soybeans Dates on the map indicate the last dates crops can be planted and still have 100% of the insurance guarantee. If crops are planted after the final plant date, crop insurance coverage is reduced 1% per day #plant19
pouring as I type......again.....ran some anhydrous yesterday in the mud. way too wet to plant anything
A couple running here on Wed. but 1.2 last night and cloudy drizzle most of today ponds again today
watching the game...dish goes out from what....pouring rain....really giving a guy the desperate stomach feel...and add to that cool temps
Got to be mega frustrating for you guys. This weekend system may sneak farther north and bring some more unwanted rains but the pattern next week will be drier and hopefully continue after that for a bit in the ECB>
USDA SUPPLY & DEMAND REVIEW May 10, 2019
CORN: The May USDA Supply & Demand report for corn was considered bearish with US 2018-19 corn ending stocks coming in at 2.095 billion bushels versus the average estimate of 2.061 billion bushels (range 1.985-2.21 billion range) and compared to 2.035 billion in April. 2018-19 World ending stocks came in at 325.94 million tonnes versus the average estimate of 315.3 million tonnes (313.0-318.2 million range) and compared to 314.01 million in April. The new crop 2019-20 US ending stocks came in at 2.485 billion bushels in a range 1.694-2.506. The 2019-20 World ending stocks were estimated at 314.71 million tonnes versis an expected range of 271.2 to 329.0 million tonnes. Brazil's corn production came in at 100 million tonnes versus the average estimate of 96.7 million tonnes (95.0-98.0 million range) and compared to the April estimate of 96.0 million tonnes. Argentina's corn production came in at 49 million tonnes versus the average estimate of 48.0 million tonnes (46.5-50.0 million range) and compared to 48.0 million in April. PRICE OUTLOOK: The much larger than expected South America production helped to cause a bearish report with December corn moving down to new contract lows. World ending stocks at 325.94 million tonnes came in well outside of the range of estimates for 313.0-318.2 million tonnes. A break to the 365 1/2 level appears to have priced in a very negative outlook and there will be many factors which could develop to shift the balance sheet more positive. Consider buying December near 365 1/2. The downside target for July corn is at 344
Corn 3 months below
Corn 1 year chart below