The planting delays continue in Illinois due to cool and wet weather conditions. (Graphic courtesy Illinois Department of Agriculture)
By Carrie Muehling
BLOOMINGTON – Grain markets rallied Monday on concerns about a return to cooler and wetter weather.
Nearby corn futures contracts closed up the 40 cent limit in Chicago as farmers face further planting delays.
“Up to this point we kept talking that it would right itself a little bit, that it was still a little too early to get too excited. But here the calendar is going to turn May this week, crop progress showed just five percent of corn planted through Sunday, so that continues to suggest a really slow pace,” said Aaron Curtis, commodity risk consultant with Mid-Co Commodities.
Illinois is still stuck at just one percent of corn planted, compared to last year’s 76 percent and the five-year average of 36 percent. Adverse conditions are again on the horizon with more rain and very cool temperatures in the forecast. Weather this past weekend was discouraging as many received another half inch of rain. But forecasts change frequently and the market will be sensitive to any sign of better weather moving forward.
“Historically, wet weather rallies typically are short-lived, just because we do end up getting the corn planted and then the market has to move on to something else,” said Curtis. “If you look at planting progress historically, the summer weather obviously has much more effect on final yield than what week in April or May we get the corn planted.”
The balance sheet for corn and soybeans is already very tight, so the market will be sensitive to adverse growing conditions, including delayed planting. The next USDA report will come out on May 10 with the first look at the 2013/14 balance sheet. Analysts don’t expect USDA will change the acreage number at this point and they look for a bearish number based on trend line yields, which would grow ending stocks considerably.
In the meantime, Curtis advises farmers to find their favorite weather forecast and pay attention.
“Things can change in a hurry,” said Curtis. “The farmer can get a lot of corn into the ground in a quick amount of time, so even a week or ten days of some clear weather, we can plant quite a bit of corn. So be mindful of that and be mindful of the reaction that could cause here in this marketplace.”
Carrie Muehling can be reached at email@example.com.