Fundamentally Speaking

In a number of posts we have documented the extreme drought conditions seen in Minnesota, North Dakota and South Dakota but there are a number of other large corn and soybean producing states that have had very arid conditions that may have been exacerbated by dry weather last month.

In fact, the USDA in comments in its latest WASDE report USDA kept its 2021 U.S. corn yield forecast at 179.5 bushels per acre (bpa). Poor growing conditions in June and in particular, drastic precipitation shortfalls can detrimentally impact the national yield.

Though overall June 2021 precipitation was lower than average across the eight corn-producing states used to model trend yields, it did not represent an extreme deviation from the 1988 to 2020 average.

Along these lines this graphic shows the percent deviation of June 2021 precipitation from the 1971-2021 average on the left axis. The rank of June 2021 precipitation and Palmer Drought Severity Index (PDSI) in the 1971 to 2021 period for the top corn and soybean producing states on the right axis.

A ranking of 1 means that state had its wettest June since 1971 and/or it had the highest PDSI reading. A rank of 51 means that state had its driest June since 1971 and/or it had the lowest PSDI reading. PDSI readings generally range from -5.00 which is extreme drought to +5.00 meaning extreme wetness.

While there has been a lot of talk about dryness in the north, many southern states have had the opposite problem of too much rains. This is especially true in the Delta such as Mississippi that saw its rainiest June since at least 1971 at 119% over average with the PDSI reading of 4.10. The PDSI is the third highest in the 1971-2021 period while Louisiana had its fourth largest amount of June rain since 1971 and Arkansas its sixth highest amount. North Carolina also had its 7th largest amount of rain. In this strange growing season states east and south have seen a tendency of above average rainfall and below normal temperatures as opposed to the drier and hotter conditions seen west and north.

Of course headlines have been dominated by the most drought stricken areas such as Minnesota, where rains last month were 57% below average. Minnesota is experiencing the third driest June since 1971 and the -2.51 PDSI rating the fifth lowest. In North Dakota, June precipitation was 36% below average at the 5th lowest with the -4.87 PDSI rating the 2nd lowest since 1971. In South Dakota, rains last month were abysmal, just 34% of normal at the driest June since at least 1971 and a very low PDSI reading of -3.19. Also looking at Nebraska, June 2021 rains were 40% below average, Kansas, 24% below normal and Iowa, at 32% below normal.

Hopefully things improve. In July, below average rains have a much greater negative impact on corn yields than above normal precipitation have on a positive influence on yields.

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