US faces more of the warm, dry weather hurting spring wheat crop


The US is poised for more of the warm and dry weather which has got the country's spring wheat harvest off to one of its worst starts on record – although fostering a recovery in corn crop condition.

Weather models for this week "show most of the Plains and the Midwest areas to be either dry or completely dry", said weather service overnight, with "the only significant rains" seen in southern states such as Alabama and Tennessee.

And for the six-to-10 day outlook, while rains are expected for parts of the central plains, including Oklahoma, into eastern Corn Belt states such as Iowa, "weather models also agree that most of this rain is going to miss… all of South Dakota, North Dakota whey really need the rain".

MDA said that "above-normal temperatures in the northern Plains over the next week will only worsen dryness" in the region, which has seen drought spread to more than 20% of the Dakotas.

At Commonwealth Bank of Australia, Tobin Gorey said that "a possible weekend storm offers the best chance of rain in the region – but that is far from a certainty.

"Should the weekend's potential rain event disappear from future weather model projections the [spring wheat] market is likely to rally some more."

Poor start

The comments came as spring wheat futures extended gains, touching $5.96 Ѕ a bushel for July delivery in early deals in Minneapolis, the highest for a spot contract in nearly two years, after US Department of Agriculture data overnight highlighted the damage to the US crop already done by dry weather.

Spring wheat ratings in top growing states and (change on week)

Minnesota: 95%, (-1 points)

Idaho: 76%, (no change)

Washington: 83%, (+10 points)

North Dakota: 52%, (-10 points)

Montana: 48%, (-4 points)

South Dakota: 25%, (-14 points)

US average: 55%, (-7 points)

Data show proportion of crop rated good or excellent, week ending June 4. Sources: USDA, Agrimoney

The USDA rated at 55% the proportion of the US spring wheat crop rated as "good" or "excellent" – a drop of 7 points week on week, far more severe than the 1-point drop that investors had expected.

The fall was also the biggest week-on-week decline for a spring wheat crop since July 2008, and left the crop with its joint worst-early-June rating on data going back to 1995, matching the 55% figure recorded in 2002.

In 2002, the US yield for non-durum spring wheat fell to 29.1 bushels per acre, which remains the lowest figure since 1989.

'Hot, dry, and windy conditions'

The decline in rating was particularly severe in South Dakota, where just 25% of spring wheat was rated in good or excellent health, down 14 points week on week.

"Soil moisture ratings continued to dry and crop conditions declined" in the state, USDA scouts said.

In North Dakota, typically responsible for roughly one-half of US spring wheat production, the proportion of crop rated as good or excellent fell by 10 points week on week to 52%.

"Hot, dry, and windy conditions were received over much of the state," the USDA said.

"Western North Dakota received little to no rain last week, while some areas of the east received up to an inch. However, more moisture is needed to aid germination and crop development."

Corn improvement

However, farmers in the Dakotas also used the dry weather to accelerate spring sowings, with 20% of the South Dakota soybean crop seeded over the week, allowing growers to get ahead of schedule.

Corn  ratings in top growing states and (change on week)

Nebraska: 79%, (+ 3 points)

Iowa: 77%, (+4 points)

Minnesota: 77%, (+9 points)

South Dakota: 62%, (-5 points)

Illinois: 59%, (+7 points)

Indiana: 43%

US average (includes other states): 65%

Data show proportion of crop rated good or excellent, week ending June 4. Sources: USDA, Agrimoney

And in states blessed with higher soil moisture reserves, warmer temperatures proved a boon in fostering improvement in corn crop condition.

In Minnesota, where "warm weather advanced crop development", the proportion of corn rated as good or excellent rose by 9 points to 77%.

In Wisconsin, "temperatures climbed into the 80s and 90s [Fahrenheit] over the weekend, improving crop conditions", with the corn rating up 7 points week on week at 68%.

In the key eastern Corn Belt state of Illinois, the corn rating also improved by 7 points week on week, to 59% good or excellent, as crops enjoyed an average temperature of 69.9 degrees, 2.1 degrees above normal, with just trace levels of rainfall, easing excessive wetness in soils.

The overall US corn condition rating rose by 3 points week on week to 68%, ahead of the 1-2 point improvement expected by investors, although still a below-average figure by the standards of the previous five years.


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