Ag Weather Forum

Mild July Looms Bearish for Soybean Market

Bryce Anderson
By  Bryce Anderson , Ag Meteorologist Emeritus
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Late-planted soybeans in the northern Midwest will need all the weather help they can get in July to produce ahead of frost. (DTN photo by Pam Smith)

OMAHA (DTN) -- There are fewer than 100 days remaining in the typical northern Iowa row-crop season -- just over three months for soybeans to reach vegetative maturity, bloom, set pods, and fill pods before the first frost. To quote a classic country music song by Jerry Reed, "We've got a long way to go and a short time to get there."

That's the issue. Just 51% of the soybeans in the north-central Iowa crop district are even emerged, according to the June 24 Iowa state crop report. That's close to one month behind the average timeline. The situation is similar in other northern Corn Belt areas after a cold and record-wet spring. "Some of the wet areas have been north-central and northeast Iowa, where crop planting is the furthest behind and they have the shortest growing season as well," said Iowa State Climatologist Harry Hillaker. "These areas just keep getting the 1 to 2-inch rains again and again."

The laggard start to the season in the northern half of the Midwest means that the summer weather forecast has some chilly overtones; particularly if an upper-atmosphere pattern which brought consistently cooler and wetter conditions to much of the Midwest starting back in February lingers through the summer.

"Frost risk is a big factor in thinking ahead to the fall season," said Iowa State University climate scientist Chris Anderson.

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Over the remainder of the U.S. soybean belt, however, a much more favorable trend appears to be settling in than in the past three seasons, when hot and dry conditions either developed in mid to late summer (2010 and 2011) or completely dominated the season (2012).

"There are no indications of an end to the blocking pattern in Canada," said DTN Senior Ag Meteorologist Mike Palmerino. "This will continue to allow the jet stream to move southward into the U.S., at times promoting episodes of cool, wet weather."

For Palmerino, the biggest concern ahead of July is the adverse effect of continued rainy spells. "The greatest concern with crops in the Midwest will be a lack of sunshine caused by too much rain, the impact of this rainfall washing nutrients out of the soils and a lack of growing degree days," he said.

But, with the market's often-quoted mantra that "rain makes grain", the general trade reaction to such a pattern -- especially with such a huge contrast following 2012's drought -- is likely to lean to the bearish side.

"Near normal temps and precip should be excellent conditions," said DTN Grain Analyst Todd Hultman. "We are still waiting to see if we will have enough soybean acres. But this July forecast sounds favorable and bearish to prices."

Bryce Anderson can be reached at bryce.anderson@telventdtn.com

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