USDA dips crop ratings again

(Agriculture.com) – Monday’s USDA-NASS Crop Progress report shows that the old adage “a small crop gets smaller and a large crop gets larger” may well be on the right track.

The latest version of the weekly collection of crop data shows corn conditions took another turn lower in the last seven days; 43% of the nation’s crop is in good or excellent condition, down 2% from last week. And, while development — namely the dough and dent stages — is catching up, maturation of the crop is still well off the normal pace at 22% complete as of Sunday. That’s compared to the previous average of 41%.

“The most amazing part of today’s USDA Crop Progress report this afternoon was that Iowa’s crop conditions held steady, despite high temperatures and no rain last week,” says Kluis Commodities and Agriculture.com market analyst and broker Al Kluis. “The hot dry weather over the last four weeks — which is now being called a ‘flash drought’ — is taking a toll on soybean yields and corn test weight.”

Monday’s report also tallied harvest progress in the last week. The general pace of 4% complete is down from the 10% average by this week of the season, but the pace is further off in a few states, especially when compared to last year’s drought-shortened crop. At this time a year ago, farmers in Illinois had just over one third of that state’s crop in the bin, and Monday’s report shows that number is 1% for this year. A year ago, Missouri farmers had 64% of their crop in vs. 10% this year.

Soybean conditions saw the exact level of deterioration as corn in the last week, Monday’s report shows. As of Sunday, 50% of that crop is rated good or excellent, down from 52% last week. Maturation is moving slower, too, with 26% of the crop dropping leaves compared to the previous average of 35%.

Markets-wise, Monday’s USDA numbers likely won’t have a tremendous impact, though Kluis expects tomorrow’s trade to open slightly lower. Now that harvest is either already underway or very close for most farmers, that action — and the crop yields it reveals — will be what most traders will now start to watch with the most interest.

“Today’s report is a little negative for prices tonight. I expect corn to start out 1 to 2 cents lower tonight. The soybean condition number dropping by only 2% is also viewed as a little negative for prices and will likely take November soybeans down by 1 to 3 cents tonight,” he says. “I look for prices to bottom out when the combines get going in Iowa.”