PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 23:53 UK, 9th Jun 2014, by Agrimoney.com
Hail hurts US corn but 'not enough to lift prices'

The hail storms which hit parts of the US last week caused more damage to corn than had been thought, but did not prevent soybeans getting off to a near-record start provoking ideas of more pressure on prices.

The proportion of the US corn crop, the world's biggest, rated "good" or "excellent" fell by 1 point to 75% in the week to Sunday, the US Department of Agriculture said.

While still a historically strong rating, the decline contrasted with market expectations for a rise of 3-4 points, to 79-80%, in the good or excellent rating.

However, ratings fell in 6 of the 18 major growing states, including in third-ranked Nebraska when the proportion of rated good or excellent fell by 6 points to 70%, hit by the rainfall which landed 2-3 inches of precipitation on the state.

"High winds and hail damaged growing crops and irrigation equipment," USDA scouts said, adding that "producers were in the process of evaluating affected crops to determine if replanting was necessary".

Near-record

In Iowa too, scouts noted "several reports of large hail".

However, the damage was minimal, with the proportion of corn rated in the top two bands staying at 82%.

And in soybeans - of which, like corn, Iowa is typically the top producing state the proportion rated good or excellent came in at 81%, helping the USDA's first national rating of the season hit 74%

The rating was "above market expectations of 72%", besides the 66% seen a year before, and only one point below the record set in 2010, according to Richard Feltes at Chicago broker RJ O'Brien.

'Some fields were salvaged'

Meanwhile for winter wheat, the proportion of crop rated as good or excellent stayed for a third week at 30%, with rains in the drought-hit southern Plains proving some support for condition at a time when, seasonally, the figure might be expected to decline.

In Kansas, the top US wheat growth state, 11% of the crop was seen as good or excellent, the same as the week before, with the proportion in Oklahoma holding steady at a lowly 5%, even though better weather helped ensure that "some wheat fields were salvaged and actually harvested for grain".

Still, overall, "condition of the winter wheat in Oklahoma remained virtually unchanged despite the recent rains", USDA scouts said.

The wet weather also "delayed the harvest of winter wheat and canola" in the state.

Broker reaction

The data were seen as bearish for prices overall, despite the surprise drop in the corn rating.

"Taken collectively, today's across-the-board better than average ratings are negative even if the corn rating is nominally below market expectations," Mr Feltes said.

At Benson Quinn Commodities, Brian Henry said that "some other reason" than the condition rating would be needed to support a rise in corn prices.

Another broker said of the soybean data that "the general consensus is negative for prices".

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