The fast pace of planting across the country is a welcome change from the historic late planting we saw last year. Although northeastern Ohio is lagging behind Ohio as a whole, the recent U.S. Department of Agriculture planting progress report shows both Ohio and the nation ahead of the five-year average.
That progress lost ground in Ohio the week of May 18, however. A rainy spell parked equipment, and the weather forecasts continue to show rain. So, the current betting is that we will not be dry enough to plant until May 22, when we are supposed to get more rain.
Ahead of average
We should be glad that the corn crop in Ohio was 57% planted as of the evening of May 17. That is a sleep-deprived 24% gain in a week, and 49% ahead of the rained-out pace of last year. It is also 8% ahead of our average.
The U.S. as a whole is now 80% planted against a 71% average. We gained 13% for the week, and are 36% ahead of last year.
National Oceanic and Atmospheric Administration is forecasting a very high percentage chance that next week has higher temperatures than normal. If we can keep the rain away, that will provide a chance to finish planting, and a fast start for the crops.
Soybean planting is also ahead of normal, both for Ohio and the U.S. as a whole. Ohio has 43% of the crop in the ground, up from just 24% last week at this time. That is 16% ahead of normal, and a whopping 40% ahead of the disaster of last year. The nation is at 53%, which is 15% ahead of the average. We gained 15% for the week, and are 37% ahead of last year.
Markets still down
Farmers do not traditionally pay much attention to markets this time of year. Their attention is on the planting. The good news for the week was that we shrugged off a mostly negative USDA supply and demand report. The bad news is that prices are still terrible and will be until we see some expected corrections in USDA numbers — and the realization that the Chinese are buying what they said they would.
The pandemic that has business shut down in this country has done huge damage to our economy. The Chinese, though, continues to make purchases of grain. They buy corn, when they did not before the agreement. They buy soybeans even though the South American beans are cheaper, especially with the collapsing real, the Brazilian currency.
Those in the know in grain markets say the Chinese need the grain, and will continue to honor the agreement. I hope so.
Corn futures were higher this week, but that may only be because the May contract was in delivery. After first notice day, the contracts become actual deliverable cash contracts. May gained 71⁄2 cents, but the July futures were only up 3⁄4 of a cent. This came after USDA said carryout would grow to 3.3 billion bushels, so I will be glad to take it.
July futures have now bounced off the $3.09 low and are trading over $3.21. The spec funds have added to their short positions, so that they now have the second-shortest position ever. Since they can turn on a dime, this actually gives us a good shot at a rally some time soon.
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