Market watching is not much fun these days. We have just watched corn and soybean futures lose a dollar a bushel in price, and it is hard to believe the reasons why.
Our crops have improved, but from poor to fair. We are being told that most of the country has great crops, and we can just adjust our thinking to that.
It’s not easy
However, it is not easy to argue against the USDA numbers that are the basis for the price decline.
Prices on the Chicago Board of Trade rallied based on crop problems. As the year has unfolded, however, the problems are seen to be localized and the crops are seen to be good.
Taking a national instead of regional view makes the argument for higher prices harder to sustain.
This morning I was looking at a national drought map. For all the hype, I was surprised to see that California was not rated severely dry, but the lessor “extremely” dry.
I wonder what the newscasts will look like if we get to “severely.” The west is burning up with wildfires that are fueled by dry conditions. The Midwest, however, is normal.
Maybe you don’t feel like we are normal. Conditions are dry. We got some sprinkles this morning, but the red clover in the field beside me is still stalled as it struggles to grow back from a rain delayed first cutting.
My lawn has been uncut for more than two weeks, and only the deep-rooted sedges in the set areas have grown. My lawn is still green because I will not cut shorter than three-and-a-half inches, and because I will not mow when it is dry.
Those lawns around me are scalped and brown. Soybeans in the neighborhood are short and not getting taller very fast. The pond in the front yard is down eight inches.
So, should I complain that we are getting burned up? No, this is the end of August, and this is normal.
One day soon the high 80s and low 90s temperatures will be broken by a big thunderstorm. Life will go on.
The reality is, the crops are big for the county, although not a record, and it is too late in the summer to change that.
Nor should we want to. There is nothing good about a poor crop.
It is just hard to take having one when most people are having good ones. Looking at the numbers, corn maturity is catching up after a late start to the crop.
Nationally, 21 percent of the corn is dented, versus 28 percent last year.
Seventy-one percent of the crop is in dough stage, up from 50 percent last week. This would argue against any significant damage from an early frost, which is realistically the last gasp chance for higher prices.
Ohio’s crop conditions continue to be a low point on the nation’s condition chart. As a nation we are 69 percent good and excellent, according to UDSA, down one percent from last week, as often happens this time of year.
Ohio, however, is only 46 percent good and excellent, with only ten percent of that “excellent.” Ohio’s soybeans are a similar, if worse, condition.
There we are rated only eight percent excellent at 36 percent good. The nation as a whole is at 63 percent, the same rating as we had last week.
As for crop progress reported by USDA, the nation’s soybean crop is even closer to normal progress than the corn crop is.
Ninety-three percent of the crop is in bloom stage. Against a 95 percent average. Seventy-nine percent are setting pods, which is the average exactly. Ohio soybeans are actually slightly ahead of average, with 98 percent blooming against a 97 percent average.
Eighty-one percent are setting pods, but 79 percent is average. It is the overall condition that suffers. Looking at prices, we see the December corn futures this Tuesday morning down one and a quarter cents, at $3.731⁄4.
This is a bounce off the low on the 12th at $3.571⁄2. That day we had a range of 36 cents, and a net loss for the day of almost 20. The low represented a loss of almost 97 cents from the high a month earlier.
Similar damage has been done to the soybean prices. We are down eight cents this Tuesday morning, at $9.09 November futures. The low was also the 12th, at $9.011⁄2. The recent high was most of a buck higher.
We were $9.961⁄2 on the tenth.
Worse, we were almost a dollar and a half higher at $10.45 on July 14. So, improved crop outlook has killed any hope for reasonable prices, and it is time to give up and sell for unreasonable ones.
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