Continued rain across the Midwest dominates all thinking about marketing these days.
All of us trying to buy grain hear the same story — “talk to me after I get the corn planted, if I get it planted!”
There was virtually no progress in planting last week, and will be none expected this week. Fields are soggy to flooded, depending where you are; it is raining this morning; and more rain is predicted for at least four of the next five days.
The USDA Crop Progress Report out Monday afternoon just confirms what we all knew — nothing is happening, unless you are in a few small portions of Iowa. There, the farmers actually got in 5 percent of the crop this week. That got them to 8 percent planted, but last year they were at 82 percent. Forty-eight percent is the five-year average.
The rest of the Midwest, however, did not turn a wheel. Ohio was stuck at 1 percent, wherever that is, languishing in the mud. Indiana is stuck at 2 percent. Michigan, like Ohio, has a nominal 1 percent. Illinois is the leading major state, but stuck for the week at 10 percent.
That puts the U.S. at 13 percent planted, actually up from 9 percent last week with help from some fringe states. Last year we were at 61 percent, with a normal 33.
Any silver lining?
So, the good news is, we are more than a third done compared to the average.
I am trying to not sound desperate. It is obvious that we are now at a critical stage. If it rains for the next week, then we spend a week drying, we will be starting planting in the second half of May. That is as good as we can expect, right now, and we have no particular expectations that are better.
Still, the forecast can change anytime.
It is fascinating that, with the corn planters parked, the market has not been soaring higher.
Let this be a major warning to those with ears to hear: The market does not want to go higher. That would have to be the conclusion, when this weather problem (Is it too early to call it a disaster?) does not send traders into a bullish frenzy.
It would seem that prices are so high that much of the fear of crop prospects being lowered is already in the market. How else do you understand the last days of trading when we had huge ranges on two days in corn, with one day down, then the other up. The third, Tuesday, is starting out with lower prices overnight.
Thursday July corn futures had a 39-cent range, and closed at the bottom, at 729 1/4. Friday, they ranged 37 1/2 cents, and closed a couple of cents below the high, at 7.56 1/2. December futures the same days were down 29 3/4 cents, then up 32.
I can assure you that the farmers expect higher prices out of this, but it is not really happening. We have not made new highs, and few are prepared for the collapse that is sure to come with the first good weather forecast.
For me, that is the real risk. Selling corn “too early” when new crop is over $6 is not a risk. It is just a marketing decision. Selling nothing, then watching improvement in the crop is the risk.
As we look ahead as agronomists, we have to believe that hopes for a big crop are gone. We will be tempted to hit the fields too soon, compacting soil. The early growth in wet soil will limit root growth, setting us up for damage with any dry weather to come.
I know, it is hard to think of dry weather. Some of the biggest arguments when I was farming with Dad were about going to the fields when we could see neighbors working.
It worked the other way, too. I remember a doctor from Cleveland who farmed in Pierpont, a traditional wet spot. He drove by our tiled farm on the way to his untiled one, saw me plowing, and ordered his help to the tractors. The farm manager told us later that in an hour they had every tractor on the farm stuck.
I remember that manager well. While visiting in our living room one night, he told us about being an officer in the German Army Signal Corps on the Russian front. He said his hair turned white in one winter.
I don’t know if farmer hair color is at risk, but this spring will be the one we remember for decades.