Fundamentally Speaking

The latest USDA weekly crop progress report showed corn conditions unchanged from last week with 74% in the good to excellent category.

Using our usual ratings system where the percent of the crop in very poor condition is multiplied by a factor of 2, that in poor shape multiplied by 4, fair by 6, good by 8 and excellent by 10 and summing the results, the crop rating as of September 7 is 774 points.

Since the USDA started keeping records in 1986, this is the fourth highest ranking for this time of year exceeded only in 1986, 1987, and 1992.

Furthermore, as opposed to the usual seasonal pattern of conditions deteriorating as the season goes on, this year ratings have stayed steady and even improved late in the season, a particularly auspicious sign that has only been seen in other years where the U.S. corn yield came in at record levels.

Note that fantastic corn yields are being reported out of the Delta where the harvest has been ongoing for two weeks now.

Talk is that if these types of yields are being seen in the Delta what will they be in the Midwest where growing season weather was uniformly better.

For weeks now we have noted that 2014 is shaping up to be one of these special growing seasons, similar to 1994 and 2004 where final row crop yields were at least 10% above trend with August to final USDA crop reports increasing by 10 bushels per acre (bpa) for corn.

This would project to a corn yield of 176.0-177.4 bpa vs. the last USDA estimate of 167.4 bpa.

(KA)