Farm officials offered US growers some hope even as they
revealed further sharp deterioration in the condition of crops, sapped by a
drought confirmed as the worst since 1956.
The proportion of the US soybean crop rated in "good" or "excellent"
condition sank by a further six points to 34% in the week to Sunday, US
Department of Agriculture data showed, more than the five-point decline that
investors had expected.
For corn, the drop was of nine points to 31%, also a bigger
fall than forecast, and stoking thoughts that the health of the crop might yet
fall below that of 1988, the worst year for growers in recent memory, when the
figure dropped to 14%.
"Without a change in the current forecast there could be a
chance for that level to be broken this year," Benson Quinn Commodities said.
'Crop conditions deteriorated'
The drops reflected the continued spread of dry conditions
west and north from the eastern Corn Belt, which has been the focus of crop
In Iowa, the top corn and soybean producing state, the proportion
of the grain making the top two grades tumbled by 10 points to 36%, and of the
oilseed by 10 points to 38%.
"Although Iowa received scattered showers during the week,
the bulk of the week was dry and sunny," USDA officials said.
"Both corn and soybean crop conditions deteriorated as high
temperatures and below normal precipitation continued to take a toll."
In the eastern Corn Belt itself, the proportion of Indiana
corn rated good or excellent fell by a further four points to 8%, and of
soybeans by three points to 11%.
However, the data highlighted too the potential for crops
yet to recover, especially soybeans, for which 84% have yet to enter the
sensitive pod-filling stage.
In corn, for which pollination is the most vulnerable
developmental step, 71% has already entered, or finished, silking.
In Kentucky and Tennessee, albeit small producing states, the
proportion of soybeans rated in good or excellent condition jumped eight
points, to 16% and 34% respectively.
"Conditions were seen improving across the south east after
a week of scattered rainfall," Benson Quinn said.
The US cotton crop, for which the region is a more important
producing area, was rated 45% good or excellent – a 1 point rise during the
"US cotton crop conditions showed a beneficial response to
the recent rain," Luke Mathews, at Commonwealth Bank of Australia, said.
USDA officials in Tennessee said that, despite "soaking
rainfall and lower temperatures… the drought is not broken" in the state.
"The corn condition rating, although improved, continued to
point to a season with over half the acreage in a heavy or extreme loss of
However, "some renewed optimism now exists for soybeans,
cotton and tobacco which are rated in mostly fair or good condition".
And even in the parched eastern Corn Belt, there was still
hope for soybeans, Darrell Holaday at broker Country Futures said following a
"I did not see any soybeans that I really feel have lost yield
if there was normal weather from this point forward," he said.
"Even where the corn was the worst, it was not uncommon to
see very good soybeans with good plant health and generally very good height."
Separately, official US meteorologists late on Monday said
that some 56% of continental US was iun some form of drought, the largest
percentage since December 1956.
"Indicators suggest that the 2012 drought is similar to the
1950s drought in extent, pattern, and intensity, although not in duration," the