Lanworth cut forecasts for US corn and soybean crops for the second time in eight days, citing the hot Midwest conditions which have revived futures prices, and warning that early frost could land a further blow.
The consultancy cut to 152.4 bushels per acre its forecast for the US corn yield, citing field studies showing "rapidly-declining yield potential in major production states," and the "persistent low rainfall and recent high temperatures" in the Midwest.
Indeed, prospects had declined particularly in the major production states of Indiana and Missouri, besides in Illinois where "given relatively delayed crop development and continued warm and dry weather over the next week, losses will likely continue".
Lanworth - which last Wednesday estimated the yield at 157.3 bushels per acre and output at 13.94bn bushels - said the crop looked like coming in at 13.40bn bushels, still a record.
However, an early frost, coupled with "extreme" damage from the Midwest heatwave, could yet drive production below 13.0bn bushels, and beneath the all-time high set in 2009.
'Extreme warm and dry conditions'
For soybeans, Lanworth cut its US yield estimate to 40.8 bushels per acre, from 41.6 bushels per acre, citing "continued and expected extreme warm and dry conditions across most production areas".
While late rainfall in August last year had provided a late lift of soybean yields, this year, "by contrast, expected precipitation in the region over the next 1-2 weeks remains near or below normal".
Rise and fall of Lanworth estimates for US corn and (soybean) yields
August 28: 152.4 bpa, (40.8 bpa)
August 21: 157.3 bpa, (41.6 bpa)
August 9: 159.1 bpa, (43.0 bpa)
July 31: 158.5 bpa, (42.9 bpa)
July 17: 156.5 bpa, (42.9 bpa)
The harvest now looked like coming in at 3.14bn bushels, down some 64,000 bushels from the previous estimate, and some 115m bushels below the US Department of Agriculture estimate.
Again, the biggest downgrade was to Midwest states such as Illinois and Iowa, which look on pace "to receive less than 25-50% of normal August precipitation".
The comments come a tense time for investors, attempting to assess the impact of the Midwest heatwave on production prospects, and therefore on prices.
In fact, some investors have been talking of a soybean yield of below 40 bushels per acre, with the corn yield typically seen at 152-155 bushels per acre, well below figures below 160 bushels per acre seen early in the month.
Indeed, Lanworth itself was, less than three weeks ago, forecasting a yield of 159.1 bushels per acre.
In supply terms, yield downgrades are seen more serious for soybeans than those for corn, of which output prospects are seen supported by huge plantings.
If the soybean yield falls 1.5 bushels per acre below the USDA estimate of 42.6 bushels per acre, stocks at the close of 2013-14 "would move to pipeline minimum", broker US Commodities said.
"If yields shrink 2 bushels per acre, the ending stocks on soybeans would be under pipeline minimums."
Indeed, on Wednesday, soybean futures for November held their ground, standing at $13.80 ¾ a bushel, up 0.25 cents, as of 09:30- Chicago time (15:30 UK time) as investors awaited fresh weather forecasts.
Corn futures for December were 0.8% down at $4.82 ½ a bushel.