Monday July 18, 2011 USDA Crop Progress report recap

The weekly crop progress report came out with little surprises, but corn is going to need more rain in the next week. The details are as follows:

Corn

The USDA NASS reported that as of July 17, 2011 the corn crop is 35% silking compared to 14% last week, 62% last year and 47% 5-year average. The condition of the corn crop is 66% good to excellent, this compares to 69% last week and 72% last year.

The Corn crop conditions were down 3% in the good to excellent category. The overall condition of the crop is still good but the current weather forecast of hot and dry conditions suggest that conditions could fall further next week. Also, with the corn crop 35% silking we are getting into the most weather sensitive growth phase and many areas need to see some rain in the next week otherwise yields could be effected.

See Corn Daily chart:

Wheat

The USDA NASS reported that as of July 17, 2011 the spring wheat crop is 60% headed compared to 27% last week, 84% last year, and 88% 5-year average. The condition of the spring wheat crop is 73% good to excellent, this compares to 73% last week and 82% last year.

Winter wheat is 68% harvested compared to 63% last week, 70% last year and 72% 5-year average.

See Wheat Daily chart:

Soybeans

The USDA NASS reported that as of July 17, 2011 the soybean crop is 40% blooming compared to 21% last week, 58% last year and 52% 5-year average. The condition of the soybean crop is 64% good to excellent, this compares to 66% last week and 67% last year.

The Soybean crop conditions were down 2% in the good to excellent category. The overall condition of the crop is still good but silghtly behind.

See Soybean Daily chart:

So, we do need some good rain very soon for corn and again durrind pod set in soybeans, but if we get it we will have a nice crop. The problem is that current weather forecasts keep us hot and dry for some time. This could mean that grains have some upside potential in the near term. However, if and when we get the rain that is needed, grains will likely put highs in the market for some time.

This means that speculators should be looking for opportunities to sell corn and producers need to look to lock up some prices while we have corn in the seven dollar range. Give me a call for some ideas. In particular, producers looking to hedge all or a portion of their production may be rather interested in some of the strategies that I am currently using.

In my mind there has to be a balance. Neither technical nor fundamental analysis alone is enough to be consistent.