IAgricultural farmers in the United States are unpleasantly surprised while sowing corn and soy. The temperature in the Midwest sometimes drops to a few degrees below zero at night and a snow shower is not surprising. Nevertheless, the sowing continues unabated.
A week ago, at the beginning of May, well over half of the corn acreage was in the ground. This means growers are ahead of other years. The 5-year average is just under 40%. Today – May 11 – the USDA Department of Agriculture will announce new figures regarding progress. About a quarter of the soybeans have now been sown and that is also considerably ahead of the average.
winter weather
That progress has probably been tempered in the past 7 days by the winter weather that again hit the country in various states such as Iowa, Nebraska, Minnesota and parts of North Dakota. There the mercury dropped to -4 in places and it will remain cold in the coming days.
A record corn area of nearly 97 million acres is expected to be sown in the country. This is surprising, since ethanol production has been significantly reduced and less corn is needed as animal feed. Arable farmers have few alternatives and therefore just put corn in the ground. In response, stock traders are betting on a falling corn price in the short term.
New figures
The new Wasde report from the USDA will be published on Tuesday, May 12, containing more information about supply and demand on the grain market. The May publication is an important indicator for the commodity market in the US. Analysts estimate that corn use for ethanol could drop by as much as 300 million bushels, while use for livestock feed would remain the same. Given the fact that slaughterhouses are closing, analysts believe there is much less demand for corn in the country.
The supply and demand news is likely to overshadow the weather troubles on the American grain market this week, although this remains an important factor. This also applies to wheat, which can also be affected by late frost during the filling of the ears. The US expects lower wheat production in the Black Sea region and the EU – as a result of persistent drought – which is positive for the world market and price. As a commodity, wheat is highly resistant to corona problems because it is in high demand and consumed more in a period when many people are at home.
Trust in wheat well
Confidence in the wheat market is good at the moment. For soy, this mainly depends on what China does. Here too, the Americans remain confident, supported by their president. However, the corn market is in the worst shape. The weather should provide a mood there, with persistent drought throughout the growing season.