KANSAS CITY, MISSOURI, U.S. — Concerns about an early frost in the U.S. sent grain and oilseed futures higher on Sept. 8, only to retreat after the weekend as the frost threat abated. Weather concerns were heightened by the late development of corn and soybean crops across northern states.
“There may be a little bit of frost in Montana and the northernmost areas of North Dakota, Minnesota and Wisconsin, but there’s not going to be a hard freeze in the Corn Belt,” said David Salmon, owner of Weather Derivatives, a Belton, Missouri, U.S.-based energy and agricultural weather consulting service. He expects temperatures in northern areas may dip to around 30 degrees this week, but probably not to the key threshold of 28 degrees that will damage plants.
Salmon said there will be a brief warm-up and then another bout of cold, wet weather around Sept. 22-24, but still no hard freeze. It’s not unusual for the northern Corn Belt to get its first freeze in the third week of September, he noted.
The U.S. Department of Agriculture (USDA) in its weekly Crop Progress report Monday afternoon rated none of the corn in Minnesota and North Dakota mature as of Sept. 7 compared with 13% as the five-year average for the date for both states, with South Dakota at 5% (12% average), Wisconsin at 3% (10% average) and Michigan at 6% (13% average). Corn mature in Iowa, the top-producing state, was 6% (27% average) and in No. 2 Illinois was 17% (36% average). Soybeans dropping leaves (thus mature) were 3% in Minnesota (15% as the five-year average), 19% in North Dakota (25% average), 12% in South Dakota (39% average), 2% in Wisconsin (7% average), 10% in Michigan (8% average), 3% in Iowa (10% average) and 7% in Illinois (11%).
“Warmer and drier conditions were needed to help row crops reach maturity,” the North Dakota state USDA field office said in its weekly crop update on Sept. 8.
The weather threat sent grain and oilseed futures higher on Friday, with corn futures advancing as much as 10¢ a bushel and soybean as much as 21¢ a bushel, with wheat pulled about 2¢ to 11¢ higher on the tail of other commodities. Frost would not have affected spring wheat or durum still being harvested in the Upper Midwest. On Monday, corn futures dropped about 7¢ a bushel and soybeans were down as much as 13¢ except for old crop September, which rose due to tight nearby supplies.
Instead, the market turned its attention back to the Sept. 11 USDA Crop Production and World Agricultural Supply and Demand Estimates reports, which most analysts expect will show corn and soybean production estimates revised higher from the department’s initial August forecasts. A survey of analysts by Dow Jones Newswires showed an average corn production expectation of 14.31 billion bushels, up 2% from August and up 3% from 2013, and an average soybean expectation of 3.882 billion bushels, up 2% from August and up 18% from last year. Both production numbers would be record high if realized.
Salmon said weather models indicate a wetter-than-normal October, which may string out the corn and soybean harvests as intermittent rainfall keeps combines out of fields. The wet weather may create some quality concerns in corn, as it has for spring wheat and durum, but probably won’t hurt production totals, he said.