USDA’s new planted acreage report out this morning says corn acres are two percent higher than last year, but that is down a point from the March report with more acres are going to soybeans.
Corn planted area for all purposes in 2010 is estimated at 87.9 million acres, up 2 percent from last year. Acreage is up in Illinois, Kansas, Indiana, Missouri and Ohio; but down significantly in Iowa, Nebraska and South Dakota. Soybean planted area for 2010 is estimated at a record high 78.9 million acres, up 2 percent from last year.
The Minneapolis Grain Exchange (MGEX) held a conference call on the report this morning, featuring commentary by Joe Victor of Allendale, Inc., who expressed surprise at the decrease from the March report in corn acres. “This is the first time that we’ve seen fewer corn acres in the June planted acreage report versus the March, but it’s also the second largest number of corn acres planted,” Victor said.
Victor says the stocks report, with corn up 1 percent at 4.31 billion bushels and usage at 3.38 billion, was also a surprise. “That’s the first time that we can ever put a 3 in front of total usage, that is a record amount of usage, March through May,” said Victor. The previous record was 2007-2008 at 2.83 billion bushels. Victor notes that ethanol usage remains strong and so are exports with recent sales to China.
The first report from USDA on corn silking progress came out today, at seven percent nationwide we are running a couple of points ahead of normal for this time of year. Some not so big corn growing states like Tennessee and North Carolina are way ahead of normal - but even Illinois is over twice the average at 15 percent. This photo was taken at a field next to the Missouri River not far from the State Capitol in Jefferson City where the corn has been soaking up the heat and humidity and growing like crazy lately.
Agronomists and farmers know that this is the most critical stage in the development of a corn plant, the reproductive stage, where the silk serves to catch falling pollen grains to fertilize the eggs in the ear that become kernels of corn. But, did you know that corn silk also has health benefits when made into an herbal tea and can cure a variety of maladies, from bed-wetting to obesity? I am not making this up.
According to phytochemicals.info, cornsilk has detoxifying, relaxing and diuretic activity and is used to treat infections of the urinary and genital system, such as cystitis, prostatitis and urethritis. “Cornsilk helps to reduce frequent urination caused by irritation of the bladder and is used to treat bed wetting problems. In China, cornsilk is traditionally used to treat edema and jaundice. Studies indicate that cornsilk can reduces blood clotting time and reduce high blood pressure.”
There is plenty of corn in the latest reports out from USDA this week.
In the first official estimate of the 2010/11 crop, USDA is projecting corn production to beat last year by 260 million bushels and total 13.4 billion. “Based on the rapid pace of 2010 planting as reported in Crop Progress, the 2010/11 yield is projected at 163.5 bushels per acre, 2.7 bushels above the 1990-09 trend. Corn supplies are projected at a record 15.1 billion bushels, 325 million higher than in 2009/10.”
That’s a lot of corn - but it could be even more than that. Corn planting is more than 80 percent complete as of Sunday and while that is not a record for this time of year, it looks pretty great compared to the last two years. Planting has been moving along at a record pace for the past 2-3 weeks and is nearly complete already in Illinois, Iowa and Minnesota. Considering last year’s late planting season, cool and wet growing season and terrible harvest conditions still resulted in a record average corn yield of 164.7 bushels per acre, chances are pretty good that better weather and growing conditions will result in better yields compared to last year.
Where is all that corn going to go? Total U.S. corn use for the coming year is expected to be two percent higher than the current year, with higher expected food, seed, and industrial use, but lower projected feed and residual use. Exports are projected to be up three percent, while corn use for ethanol is projected at 4.6 billion bushels, up 200 million from last year. If the estimates are right, the increase in corn production expected for this year will more than offset the increase in use for ethanol expected. Interesting. We have to wonder what we would be doing with all this corn if it were not for ethanol use.
So far this spring is shaping up to be a lot different than last year, in a good way.
This time last year we had just seen 7-10 inches of snow across the corn belt, with frost and freeze into the deep south. In contrast, almost one third of the country saw record high temperatures last week, and this week has been almost picture perfect spring weather in the Corn Belt, which bodes well for planting progress.
In the first planting progress report of the season, USDA reports that as of Sunday, producers had planted 3 percent of the intended corn acreage for this year, up from last year, but 1 percentage point behind the 5-year average. Planting was underway in Illinois, Indiana, Iowa, and Minnesota, 4 of the 5 largest corn-producing States, with progress slightly ahead of normal in Iowa and Minnesota. In Illinois, overall progress was 3 percentage points behind the 5-year average, but slightly ahead of progress from the previous 3 years. Kentucky and North Carolina are way ahead of last year, with 10 percent and 34 percent planted respectively. For Kentucky, that’s still a little behind normal, but NC is well ahead of the average of 25 percent for this time of year. Only Wisconsin, Nebraska, North and South Dakota have yet to show any progress, which is normal for them.
The ethanol industry is speeding toward the blend wall with a heavy foot on the accelerator and only quick action by the federal government will help it break through.
The industry continues to prove that it can produce record volumes of ethanol and still meet the demands of livestock producers and the export market. The U.S. ethanol industry began 2010 with yet another month of record production. The latest report from the Energy Information Administration (EIA) puts January 2010 ethanol production at an average of more than 818,000 barrels per day, compared to 188,000 in January 2009.
That makes four months in a row of record ethanol production, but gasoline demand remains flat and ethanol stocks are increasing. Returns for ethanol producers are down as prices have dropped sharply. USDA’s latest supply-demand report out Friday left projected 2009-10 corn use for ethanol unchanged at 4.3 million bushels but lowered corn feed and residual use by 100 million bushels lower as March 1 stocks and the record January ethanol production indicate lower-than-expected December-February feed and residual disappearance. The report notes that poor margins for ethanol producers and rising ethanol stocks may limit near-term growth in production.
That means that the future for ethanol literally hinges on the decision EPA has yet to make - moving the allowable blend level for ethanol in gasoline up to 15 percent from the current 10. “Given the fact that gasoline consumption in this country simply is not growing very rapidly and has essentially been flat for some time now, we are getting to the point where we simply have absorbed as much ethanol as we can under the current E10 legislation,” said USDA Outlook Board Gerry Bange
Renewable Fuels Association President Bob Dinneen says the “antiquated” E10 regulations need to be changed to allow the increased use of ethanol and ethanol blends. “The increase seen in ethanol reserves during a time of great economic advantage in ethanol pricing speaks directly to the need for EPA to allow up to 15% ethanol blends for all vehicles, regardless of model year,” said Dinneen.
The EPA has delayed its final decision on the matter until some time this summer. Let’s hope they make it before we hit the wall.
Corn growers intend to plant 88.8 million acres of corn for all purposes in 2010, up 3 percent from both last year and 2008. Expected acreage is up in many States due to reduced winter wheat acreage and expectations of improved net returns. Acreage increases of 300,000 or more are expected in Illinois, Kansas, Missouri, and Ohio. The largest decreases are expected in Iowa, down 200,000 acres, and Texas, down 150,000 acres.
Soybean producers intend to plant 78.1 million acres in 2010, up less than 1 percent from last year. If realized, the U.S. planted area will be the largest on record. Acreage increases of 100,000 or more are expected in Illinois, Iowa, Kansas, Nebraska, North Dakota, and South Dakota. The largest decreases are expected in Georgia and North Carolina, both 150,000 acres less than 2009. If intentions are realized, the planted acreage in Kansas, North Dakota, and Pennsylvania will be the largest on record.
Early reaction to the report is that total acreage is too low and more corn and soybean acres will probably be planted. Corn growers in Iowa say they definitely expect to see their acres increase when it’s all said and done. During a conference call this morning, Iowa Corn Promotion Board Chairman Tim Burrack from the northeast part of the state said the survey was done a few weeks ago when the weather still looked pretty bleak, but that has turned around dramatically. “In our area, I am amazed at how quickly winter left and spring came,” Tim said. Field work has been underway since Friday and he says they should be ready to plant as soon as the soil warms up.
Iowa Corn Growers Association board member Kevin Ross on the opposite end of the state in the southwest says the corn that was left unharvested over winter also probably had an impact on the acreage estimate, but the combines are running now and getting the last of that unharvested corn out of the fields. Kevin says it looks pretty good after the long winter, drier and with higher test weights. “There really is minimal damage from wildlife and the condition of the crop as far as mold is very good - it’s shocking that there is no real damage in that respect,” Kevin said.
The weather is just about ideal right now in the corn belt - maybe Mother Nature will give the Midwest a nice spring break this year for a change!
During a press conference at Commodity Classic, the question was posed to Agriculture Secretary Tom Vilsack whether the Department of Agriculture should be re-named the Department of Food - which I guess would make him the Secretary of Food.
Vilsack said you could look at the department in a number of different ways. “When the department was founded in 1862, the substantial percentage of the population was in the farming business, so it made all the sense in the world to call it the department of agriculture. Today, the mission of the department of agriculture is fairly diverse and not very well understood by a lot of people in the country. Seventy percent of our budget is in the form of food assistance - the SNAP program, the WIC program, the school lunch and school breakfast programs. Now, one could say that makes the argument for the Department of Food, but I would say a lot of those programs are benefited from commodity purchases which help stabilize markets and that’s beneficial to the farmers, so maybe it’s okay to say Department of Agriculture.”
“We do a lot of rural development activities, trying to build strong communities and regions and trying to promote business and industry, and so you might think we should call it the Department of Rural Development. Except that the vast majority of farm families get a substantial percentage of their income off the farm, so the capacity to create jobs in rural communities basically helps people keep the farm, so maybe it’s okay to call it the Department of Agriculture.”
Ditto for the department of global food aid, or forestry, or food safety. “The point is this is a department that has multiple missions but at the end of the day, every single mission comes back to the beginning of this department, which is that it’s beneficial in some form or fashion, directly or indirectly, to farmers,” Vilsack concluded.
There may still be corn left standing in the snow, but USDA says the 2009 corn crop was a record setter.
In today’s crop production summary report, USDA projects U.S. corn production at a record 13.2 billion bushels, up from 12.9 billion bushels projected in USDA’s December forecast and 1 percent above the previous record of 13.0 billion bushels set in 2007. The corn yield is estimated at a record 165.2 bushels per acre in 2009, 2.3 bushels higher than the December forecast and 4.9 bushels above the previous record of 160.3 bushels per acre set in 2004.
Rebecca Fecitt, U.S. Grains Council director of biotechnology programs, said the continued utilization of scientifically proven biotechnology applications provided by life science companies will help to increase corn yields, solidifying the need to continue developing markets for U.S. coarse grains.
“We hope to see this upward trend in yields for U.S. corn continue. As science becomes even more sophisticated, it will help increase and maintain our yields. This will be instrumental in feeding the world’s forecasted 9.1 billion people by 2050,” said Fecitt. “The growing population, especially in developing countries, will demand more meat, milk and eggs as incomes continue to increase. We have to maintain our biotechnology education efforts in order to ensure that grain derived from biotechnology is accepted around the world.”
The Renewable Fuels Association (RFA) says this proves the amazing productivity of the American farmer. “The unparalleled productivity of America’s farmers continues to amaze even the most skeptical of critics,” said RFA president Bob Dinneen. “Despite unfavorable weather conditions from start to finish, farmers produced considerably more corn than the food, feed, and fuel markets are demanding. Such gains in productivity undermine any claims that U.S. biofuel production will require new lands in other nations to come into production. There can be no question that American farmers have both the capability and the can-do attitude to feed the world while simultaneously helping reduce our nation’s reliance on imported oil.”
American farmers should be commended for this accomplishment.
There’s still a lot of corn in “field storage” out there, as the cold and snow continues throughout the corn belt.
The term “field storage” may be somewhat euphemistic, but pretty accurate at this point, since most of it will probably be there for some time yet. While I have heard some growers say that leaving corn in the field through winter is not totally unheard of, it is definitely not normal and even kind of sad - as Stu Ellis writes in the Decatur Herald-Review:
There is something about a cornfield full of snow that reflects tragedy. “What happened here?” “Why wasn’t this harvested earlier?” “Was this farmer hurt, or was there a death in the family?” Corn is just not supposed to be standing in snow, but currently 5% of the US corn crop remains in the field and there is snow on the ground throughout the Cornbelt.
USDA is still keeping track of the harvest, although they stopped issuing official weekly updates before Christmas. According to meteorologist Brad Rippey, “The corn harvest has reached just 71 percent in North Dakota, meaning that more than 1 out of 4 fields is left to be harvested there,” Rippey said. That is the worst of it, but there is still 3-7 percent of corn left in the fields of Illinois, Michigan, Minnesota, Nebraska, South Dakota and Wisconsin. “That is very little progress from what we saw two weeks ago, mainly due to the big holiday blizzard that the western corn belt experienced making any field work just about impossible,” Rippey said.
The good news is that we still have plenty of corn to meet demand both domestically and internationally. The corn that is left remains in pretty good condition, although test weights will be lower and mold could be an issue. And, most importantly, the farmers who struggled with the elements in 2009 to produce another excellent crop to feed and fuel the country and the world will be back at it again this spring, as long as the good Lord is willing and even if the creeks do rise.
Nationally, the corn harvest progressed 14 percent last week, but remains 26 points behind normal for this time of year, according to USDA’s National Ag Statistics Service. Harvest was most active in Michigan, Minnesota, and Wisconsin where producers combined 21 percent or more of their crop. Despite the active harvest pace in these States, overall progress remained over 2 weeks behind normal. Wet weather in Illinois and Missouri held the harvest pace to single digits during the week.
Meanwhile, the soybean harvest has just about caught up to normal at this point, with 94 percent of the crop now done - just three percent behind average.