US farm officials flagged the potential yet for soybeans to
recover – if sufficient rains arrive - even as data showed the condition of the
domestic crop, and of corn, continuing to suffer amid the worst drought since
The proportion of US corn rated in "good" or "excellent"
condition dropped by five points to 26% in the week to Sunday, falling closer
towards the mid-teens levels reached in 1988, the worst year on record, US
Department of Agriculture data showed.
According to Mark Welch, agricultural economist at Texas A&M
University, the figure "puts this year's yield at 132.2 bushels per acre",
assuming a steady crop condition from now on,
A result at this level would be well below the USDA's
forecast of 146.0 bushels per acre but in line with levels that the brokers are
already touting. Goldman Sachs on Monday forecast a 126.0 bushels-per-acre
For soybeans, 31% of the crop was seen good or excellent, a
drop of three points on the week, and also a 24-year low.
'Disking it under'
The declines reflected in particular further damage from
high temperatures and a lack of rainfall to crops in Iowa, the top corn and
"Another hot, dry week without significant precipitation in
most areas of the state caused Iowa crop conditions to decline," USDA officials
"With deteriorating crop conditions, there have been reports
of some farmers starting to chop corn" - cutting it for fodder rather than bank
on the crop producing viable cobs.
In Illinois, the second biggest producing state, "there were
several reports from southern areas of producers cutting corn originally
intended for grain into silage or even disking it under".
'Water won't help the
However, the decline in overall soybean condition concealed
improvement in six states which received rains, including Tennessee, where the proportion
rated good or excellent increased for a second week, to 39%.
"High temperatures and moderate rains stimulated crop growth
last week," USDA farm officials said, with some county agents reporting sharp
improvements to soybeans.
One spoke of a "general rain that improved soybean field
dramatically", with another saying that "high temperatures combined with showers
have soybeans growing, blooming and setting pods".
John Goddard, agent in Loudon County, said: "Rains this week
have helped soybeans and pastures. Corn is dead and water won't help the dead."
The potential for soybeans to revive, and with rain in the
Midwest forecast, helped on Tuesday keep up the pressure on Chicago prices,
which fell further from last week's record highs.
The August lot stood 2.2% lower at $16.61 a bushel as of
10:30 UK time (04:30 Chicago time), taking its total decline from Friday's
all-time top to 6.5%.
November soybeans stood 2.3% lower at $15.85 a bushel.
"While there has been some crop damage, part of the crop is
still salvageable with a significant shift in weather," Phillip Futures said.
"The impending relief is expected to more helpful to soybean
than corn, as the former enters its pod-setting and pod-filling stages that are
critical to determining yield while much damage has already been done to later
during its critical pollination stage.