Fundamentally Speaking
Joel Karlin DTN Contributing Analyst

Friday 06/20/14

July Temps in IA & IL Following "Wet" June
This piece looks at the history of July temperatures for both Iowa and Illinois following "wet" Junes since 1950.[Read Full Blog Post]
Posted at 7:44AM CDT 06/20/14 | Post a Comment
Comments (2)
How about a comparison of % of trend yields in wet vs other years? Isn't that ultimately more important than just July temps? Interesting and useful study since the market will react to July temps even though July temps may not have much effect on final yields?
Posted by FRED DAUME at 4:37PM CDT 06/24/14
US corn yields, on harvested acres, over the last 40 years tend to be within the range of 100% to 105% of trend line 35% of the time. Yields have been below trend 37.5% of the time and over 105% of trend 27.5% of the time. A very simple model can be made where good and excellent corn condition rating is compared to ending US corn yield as a percent of trend line yield. The latest weighted 18 state percent in good and excellent condition was 74%. When a plus or minus 5% error factor was used to provide a range of possible outcomes, one finds US yields have been in a range of 93% to 113% of trend line yield when the good and excellent rating has been from 69% to 79%. The mid-point yield is 102% with an average of 104%. The CME Dec options and the June WADSE projections for the 2014-15 corn marketing year were reviewed to see what the possible implication might be for price. These combined projections seem to indicate about a 50% chance Dec CME corn prices at expiration will range from $4.20 to $4.50 per bushel. There seems to be a 20% chance of closing below $4.20 and a 30% chance of being over $4.50. (This means, as things stand now, there looks to be a 70% chance of closing Dec future below $4.50.) Our WAG (wild ass guess) seems to indicate less down side risk and potentially more upside possibilities than generally heard on the "street/coffee shop". The June report numbers could change these projections very easily. Freeport, IL
Posted by Freeport IL at 4:37PM CDT 06/25/14
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