US corn sowings lag, but investors not nervous yet

Investors remained sanguine on US corn sowing prospects despite plantings proceeding at a far slower pace than expected, particularly in the key Corn Belt states.

US growers had planted 6% of their corn as of Sunday, up 3 points week on week, but well below the average of 14% by now, US Department of Agriculture data showed.

The figure was far lower than expectations of more than 9% forecast by investors, and in area terms, the lag behind the average is equivalent to more than 7m acres, nearly the size of Belgium.

And it and was most marked in Tennessee, where 19% of corn was seeded - 25 points behind the average.

"Cool soil temperatures and rain again hampered corn and cotton plantings," USDA scouts said.

'Waiting for soil temperatures to improve'

However, delays were also marked in Illinois, typically the second-biggest corn producing state, where "corn planting progressed to 5% complete but remained well behind the five year average of 22%", USDA scouts said.

In neighbouring Indiana - where plantings, at 1% completed were 13 points behind the average sowing had begun "in very limited quantities, restricted mostly to southern districts", scouts said, adding that "most farmers are still waiting for soil temperatures to improve".

Further north in Minnesota, another big corn growing state, most farmers "are still waiting for suitable conditions to begin planting", with sowings registered at zero, compared with the 9% usually completed by now.

And in Iowa, the top corn state, seedings were 2% complete, 9 points behind the average pace.

"Rain and cool temperatures early in the week continued to slow fieldwork," scouts said.

Lesson from last year

Nonetheless, many commentators shrugged off the setback, with Richard Feltes at Chicago broker RJ O'Brien noting that last year, when sowings progress was even slower, at 4% completed nationally by now, the US harvest ended up with a record corn harvest.

"Recall that the US corn yield last year of 158.8 bushels per acre was achieved despite the majority of the corn crop being planted in late May, and slightly below normal June-July and August precipitation," Mr Feltes said.

"The corn market won't get excited about the corn situation unless delays persist beyond the Monday May 5 update," with some viewing May 1 as a key sowing deadline, after which yield potential falls, although other commentators use mid-May.

'Planting progress could surge'

In fact, corn sowings are expected to show rapid progress for now, thanks to improved weather

"Weather forecasts suggest fair planting weather for the next few days," CHS Hedging said, if noting that ", rains should move through according to the 5-to-10 day weather forecast", helping corn already planted but potentially slowing fieldwork.

At Singapore-based Phillip Futures, Vanessa Tan said that "should US planting conditions remain favourable, planting progress could surge during the next crop progress report".

Weather service MDA told investors to expect "only minor delays to fieldwork and early corn planting" from showers yesterday and expected on Thursday.

'Fieldwork delayed'

The USDA report showed delays in sowings of other crops too, including sugar beet, for which plantings, at 11% complete, were 18 points behind the average, and rice at 32% finished rather than the typical 44%.

In oats, sowings were 20% complete, well behind the 55% usually finished by now, and even last year's result of 41%.

On spring wheat too, plantings were well behind, at 10% finished, compared with 19% usually.

In the main producing state of North Dakota, where only 1% of spring wheat was in the ground, "fieldwork continued to be delayed with soil temperatures still in the 30s and 40s Fahrenheit", USDA scouts said, if adding that "reports indicated that, on average, producers intended to begin fieldwork by April 29".

And for cotton, sowings, at 9% finished, were 3 points behind the average, including in the top growing state of Texas, where "some producers were waiting on more precipitation before making final planting decisions".

'Record breaking cold'

As for the important winter wheat condition rating, this held at a meagre 34%, in terms of the proportion of the crop rated "good" or "excellent".

The national figure disguised some improvement in soft red winter wheat-growing states, such as Illinois and Ohio, while seedlings in hard red winter wheat-growing areas continued to deteriorate.

In Kansas, a hard red winter wheat state, and indeed the top wheat grower overall, the proportion of crop rated good or excellent dropped 2 points to 24%, after early-week frosts.

In Oklahoma, which suffered "record breaking cold" for the time of year, the proportion of winter wheat rated good or excellent dropped 3 points to 11%.

"Some winter wheat producing counties experienced below-freezing temperatures for an extended period of time," USDA scouts said.

"The already-drought-stressed winter wheat and canola crops were negatively impacted by the freeze."

Only 6% of Oklahoma canola was rated good or excellent.

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