Fundamentally Speaking
Joel Karlin DTN Contributing Analyst

Wednesday 07/31/13

Timing of Lows in Dec Corn
The accompanying chart shows the scatter-plot relation between the percent that final corn yields deviated from trend and how many days after January 1 did the December corn futures of that year make its low.[Read Full Blog Post]
Posted at 9:05AM CDT 07/31/13 | Post a Comment
Comments (1)
The latest USDA crop progress report show 86 percent, of the corn, in the 18 states followed by the report, has silked. The five year average is indicated at 89 percent. A four year average; backing out last year's rapid pace, is around 86 percent. So on average the crop is progressing nicely. The problem is; this is on average. Looking at the states that are behind the 4 year average, one finds 3.2 million harvested acres are behind pace. (Calculated by subtracting August 4, 2013 progress from 4 year average and any state that was behind pace was multiplied by June's harvested acres estimate.) Three northern states: Iowa, Minnesota and Wisconsin made the "cut" and accounted for 80% of the total acres. Iowa was 60%, Minnesota 13% and Wisconsin 8% (does not add to 80% because of rounding). We "handicapped" Iowa's potential yield loss using our estimates from the July 17, 2013 comments on this blog. (One location was used to project the whole state which is expected to cause an error in our numbers.) A nice long, "frost free" fall may not see any yield loss but the weighted average loss is calculated at 4.5 bushels per acre for the state. Should Iowa's yield dropped by the levels projected, the US production of corn will have a very hard time producing over 13.8 billion bushels. This is based upon a detrended relationship of Iowa's corn production with the US's. Frost damaged corn takes a long time (generally expected after the June stocks report) to be reflected in USDA"s balance sheet and thus price. So if one is "betting" on a frost rally, the full "payout" may not be realized till the next summer. Freeport, IL
Posted by Freeport IL at 11:25AM CDT 08/06/13
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