The usefulness of official US crop condition data came into
question as many commentators raised their estimates for corn and soybean
yields close to year ago levels, despite weaker Washington ratings.
Analysis group Lanworth flagged the "importance of
acknowledging the limitations" of the US Department of Agriculture's weekly
crop condition scores, flagging the "need to utilise additional sources of
information when generating yield forecasts".
"There is certainly some disconnect going on," a US broker
"The crop condition data appear to be showing in many cases
a different crop to what you are seeing in other reports."
The comments come amid attempts by brokers to reconcile data
showing relatively poor condition scores in weekly USDA crop progress reports,
of 60% for soybeans and 62% for corn, with elevated official yield estimates
for the crops.
The crop ratings are below four-year average of 67% for
soybeans, and 69% for corn.
However, the USDA is forecasting a corn yield of 169.5
bushels per acre, behind only the record 174.6 bushels per acre last year, with
the soybean figure at 49.4 bushels per acre, again second only to 2016, which
saw a 52.1 bushels-per-acre result.
While many commentators have been forecasting more notable
drops in yield prospects this year, in line with the figures suggested by the
weekly crop condition data, this week has brought a series of upgrades.
In corn, a "few more pundits moving closer" to USDA's 169.5
bushels-per-acre yield figure, said Benson Quinn Commodities.
These include Michael Cordonnier, the respected analyst, who
this week raised by 1.5 bushels per acre to 165 bushels per acre his estimate
for the US corn yield, and by 1.0 bushels per acre to 47.5 bushels per acre his
forecast for the soybean result.
Chicago broker Futures International raised its corn yield
forecast above 170 bushels per acre, while raising its forecast for the soybean
figure to 49.8 bushels per acre.
"Like corn, we believe there is a possibility USDA will
increase the soybean yield" in next month's monthly Wasde crop report.
'Seem at odds'
Lanworth – as it on Wednesday nudged its own forecasts for
the US corn yield higher to 168.2 bushels per acre, and for the soybean yield
to 47.7 bushels per acre – said that this year's USDA yield estimates "seem at
odds with expectations" based on the crop condition data.
The group, which is own by Reuters, noted, for instance,
that the USDA corn yield estimate for Nebraska, at 183 bushels per acre, was 5
bushels per acre above the year-ago level – yet the state's crop rating, at 63%
good or excellent, was down 13 points.
"Similar discrepancies existing in other major producing
states, such as Indiana and Ohio."
'Not an ounce of
At North Dakota-based Halo Commodity Company, Tregg Cronin
highlighted volatility within crop condition data, which has seen some large week-on-week
moves in state ratings, and subsequent large reversals.
"The rating changes in Colorado this year have been so
erratic there can't be an ounce of credibility lent to their numbers," Mr
"One observer pointed out the Illinois corn crop is rated
just 4 points better than the North Dakota crop," with good or excellent
readings of 54% and 50% respectively.
Yet North Dakota has been suffering weather setbacks of
historic proportions, with 82% of the state rated in drought as of last week, compared
with just 1.2% of Illinois.