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Expectations mount of US corn harvest not being finished until 2020


Talk is growing of the US corn harvest not being finished until next spring thanks to the setback to fieldwork from poor weather, after a delayed spring sowing season, and compounded by a shortage of propane for crop drying.


David Meyer, chairman and chief executive of Titan Machinery, one of North America’s largest farm machinery dealers, said that US growers in some northern US states would be unable to finish their corn harvesting before winter sets in.


“We anticipate the completion of the corn harvest in Minnesota, North Dakota and South Dakota extending into the first quarter of calendar 2020 due to the extreme conditions, propane shortages and the high corn moisture levels,” he told investors.


‘Blizzard conditions’

The assessment have been echoed by some other commentators, with Mike Mawdsley at First Choice Commodities saying overnight, from Iowa, that with “blizzard conditions” arriving “in areas where crop is still in the field, those crops may remain in the field until next spring”.


Other brokers too, including Futures International, INTL FCStone and Rabobank have also voiced ideas of harvest lasting into 2020, while a US broker, who preferred to remain nameless, told Agrimoney on Wednesday that there was “no chance” of a 2019 completion of the harvest.


“I just can’t see it. Weather would have to be very benign to get this harvest finished, and the forecast just doesn’t look like obliging.”


According to Maxar, in the Midwest this week “snow in north western areas will stall remaining harvesting, while active rains in central/south eastern areas stall harvesting there as well”.


‘Bushels will be lost’

Official data earlier this week showed 16% of corn yet to harvest as of Sunday, compared with a five-year average of 5%.


At Agrivisor, Karl Setzer calculated that the US still has 13.1m acres of corn to harvest, equivalent to some 2.2bn bushels of crop.


And the impact of the delayed harvest is more than academic, with Mr Setzer saying that “there are now thoughts that some of these bushels will be lost and not harvested at all”.


Furthermore, he noted that “quality issues… are starting to build” thanks to the crop being left in the field for a prolonged period, with “some of this year’s corn struggling to top 50 pounds per bushel” in test weight.


This is landing farmers with “discounts of nearly $0.20 per bushel”, and the threat of crops being simply rejected, while buyers are being forced to pay a widening basis for high quality corn for near-term delivery.


Other potential knock-on effects include delays to sowings in 2020 in areas where farmers still have 2019 crops to harvest in the spring.


‘Shot in the arm’

Nonetheless, Titan Machinery’s Mr Meyer noted some upbeat talk on harvest results too, saying that “while there are pockets of preventative plant and drowned-out crops, the yield reports for the fields that reached maturity have been good”.


The highest yields had come “from growers in Iowa followed by Nebraska”, he told investors.


He added that “farmer sentiment is being impacted by the late harvest, along with the uncertainty with trade issues and its effect on exports and commodity prices”.


The US Department of Agriculture’s market facilitation payments “have been a shot in the arm for our customers”.


The comments followed Titan’s announcement on Tuesday of quarterly earnings below market expectations, while trimming too to $0.75-0.85, from 0.75-0.95, its forecast for earnings per share for the year to the end of January 2020.


Titan Machinery shares, which closed down 15.5% on Tuesday, stood a further 4.7% lower at $14.521 in midday deals in New York on Wednesday.

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