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Corn prices made gains on reports that the early US harvest is coming in considerably short of estimates, with one farm seeing a yield 30% below that estimated by ProFarmer experts a week ago.
US Commodities, the Iowa-based broker, said that sources had reported a corn field in southern Illinois that had on Wednesday produced 142 bushels per acre, compared with an estimate of 200 bushels per acre from last week's ProFarmer tour.
"The corn had poor test weight and disease problems," having been infected by the diplodia ear rot fungus, the broker said,
And the issue of disappointing yields was not an isolated one this far into harvest.
"From what we are seeing reported, yields are 5-10 bushels down from what was being expected," Don Roose, the US Commodities president, told Agrimoney.com.
"The question is whether this will follow through to the rest of the harvest."
'Insidious heat'
Benson Quinn Commodities also noted "reports of lower than expected early harvest corn yields in the southern US".
"Some test plot testing in Minnesota by seed companies are finding disappointing corn yields due to shallow kernels," the broker added.
At North America Risk Management Services, analyst Jerry Gidel said that hearing that yields were "not that impressive".
Many even relatively northerly areas had received "an insidious heat, 45 days above 80 degrees [Fahreneheit]", he said, adding that he had heard of yields "as much as 30 bushels [an acre] below expectations".
However, the market was still some 7-10 days from getting a "good indication" of yields, after the harvest reaches major corn areas.
Weight problem
The twist of the relatively poor crop was that if so-called test weights – the weight of corn per bushel of volume – proved poor for a second year, it would stymie growers' hopes for getting a decent price for crop held over from the last harvest.
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IGC 2010-11 corn forecasts, change on July estimate (and on 2009-10)
Production: 829m tonnes, -6m tonnes, (+2.5%)
Trade: 90m tonnes, +2m tonnes, (+4.7%)
Consumption: 837m tonnes, +7m tonnes, (+2.1%)
Year-end stocks: 360m tonnes, -9m tonnes (-8.6%) | "This year, we have heard of test weights of 50-52 pounds a bushel," Mr Gidel said.
"Some farmers were hoping to see an improvement, and mix this year's grain with last year's to bring the test weight up to 55-56 [pounds a bushel]."
The standard bushel weight for benchmark number 2 yellow corn is 56 pounds.
Contrary view
However, expectations of a disappointing American corn harvest were not voiced by the International Grain Council, which attributed a 6m-tonne rise to 829m tonnes in its forecast for world corn production to "improved crop hopes in the US and in Africa".
The influential group also lifted its estimate for corn consumption by 7m tonnes to 837m tonnes to reflecting the jump in prices of other feed grains which had made it "increasingly price competitive".
"After the comparatively steeper rise in wheat and barley export values since June, [corn] has become more competitive," the IGC said.
Chicago corn for September stood 2.9% higher at $4.16 ½ a bushel at 16:15 GMT.
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