Inside the Market

Every growing season has its own unique challenges that make it difficult to compare to prior years. In late February in Nebraska, I was sitting outside in 70°F temperatures one Sunday afternoon talking with relatives about the drought that much of Nebraska and the Midwest were experiencing. Kansas and Texas had already had outbreaks of wildfires. Little did we know the turn that spring was about to take.

Corn and soybean planting got off to good starts in early April, but by the end of the month, the Midwest was starting to see more rain, accompanied by severe weather, including hail and tornadoes. On April 26, the National Weather Service in Omaha issued 48 tornado warnings, the most in a single day. By late May, 98 tornadoes had been reported in Iowa, with Texas close behind at 96.

Even if your farm didn't suffer hail or storm damage in early 2024, there's a good chance you spent several days waiting to plant while wave after wave of rain went by in May. In early June, USDA reported 41% of Wisconsin, 37% of Kentucky, 34% of Minnesota and 30% of Ohio were dealing with surplus topsoil moisture. Replanting was common in several areas.

In terms of sheer planting delays, 2024 was not as bad as 2019, but the year did resemble 2022, a year that had the second slowest planting pace of the past 10 years and posted 6.4 million acres of prevented plantings. Many expressed concerns about mudding the crop in, a less-than-ideal way to start a new crop.

Now, as the calendar turns to August, many farmers will breathe easier knowing their crops made it through a rough start, but that won't be true for everyone. It is yield-guessing time again, and with that, I'd like to offer some perennial tips.

Every yield-estimating method has its pros and cons. Getting out of the truck and peeling back husks, or counting soybean pods can help you notice things you won't see from a satellite. But, even several hundred stops along the highway are just tiny samples of this country's production. As we saw in the Western Corn Belt last year, fields we look at in August can be a lot different in September.

Using sophisticated weather and satellite data are wonderful ways of getting a comprehensive look at the big picture, but the greenness of crops -- or lack thereof -- does not always correlate to yield. As much as we would like to compare what we know to previous years, each year is unique, and advances in seed technology continue to move the baseline for potential yields.

As a parting thought, don't confuse the fascination and fun of playing the yield-guessing game with making good risk-management decisions. The world of market factors affecting prices is much bigger than yield. The risk to prices can come in many different disguises.

After a rough start early in 2024, best wishes for a good harvest.

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-- Read Todd's blog at https://about.dtnpf.com/…

-- You may email Todd at todd.hultman@dtn.com, or call 402-255-8489.

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