Row crop markets remain under pressure as each weather model run confirms what looks to be a big change in conditions with almost all of the Midwest to receive not only normal but above average rains starting this weekend, and even western areas of Corn Belt and Plains that have been very stressed also to see some timely precipitation.
This along with talk of recession, signs of progress in negotiation with regard to the resumption of Ukrainian grain exports and sentiment that the bloom is off the commodity markets resulting in more fund liquidation had sent corn futures to their lowest levels since late January.
It appears that there are just not enough corn areas in the U.S. to offset those sections that have good or better crop prospects and with recent rains in Indiana, the three big "I" states including Iowa and Illinois seem to be doing well.
Seeing in Monday's crop condition report that in the country's two biggest producing states, 70% of Illinois corn crop rated either good or excellent which is the highest combined percent since 2018 and a whopping 81% of Iowa crop in the top two categories, tied for third as the highest percent since 2003.
Using our usual ratings system where we weight the crop based on the percent in each category and assign that category a factor of 2 for very poor, 4 for poor, 6 for fair, 8 for good, and 10 for excellent and then sum the results this chart shows the week 28 (around the third week of July) crop ratings for Illinois and Iowa corn on the left-hand axis vs the percent that their final corn yield deviates from the 25-year trend on the right-hand axis.
We also report the percent of their crop silking as of week 28 with the numbers in blue squares the percent of the Illinois corn crop and in orange squares the percent of Iowa's corn crop.
The current Illinois rating of 750 above year ago 742 when that states corn yield turned out to be 2.8% above trend and rating 2.0% above 1998-2022 average while current Iowa rating of 790 also above year ago 742 when that states corn yield turned out to be 4.3% above trend and 2022 week 28 rating 4.3% above 1998-2022 average.
Both crops seeing percent silking at 60% and 31% respectively just above 25-year average.
Should note that correlation between week 28 Illinois corn ratings and percent that final yield deviates from 25-year trend at a high 82.5% but for Iowa quite a bit lower at 49%.
Interestingly running a regression using week 28 crop ratings and percent silking results in a yield 4.3% above trend for both IL and IA and both have the same 25-year trend this year at 199 bpa.
That works out to a final yield for each at 208 bpa which for Iowa would be a new high and second best for Illinois next to the 210 bpa seen in 2018 with the R squared for Illinois at a quite decent 70% dropping to 32% for Iowa.
Point is right now, numbers one and two corn producing states seem to be holding up their end of the bargain as corn market has responded in kind.
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