Fertilizer Markets and Finance

Corn and soybeans deteriorated far more significantly than the market had expected as damage from the heatwave spread into northern areas where producers had held out hopes of decent harvests.

The proportion of US corn rated in “good” or “excellent” health fell by eight points to 48% in the week to Sunday, the US Department of Agriculture said.

The figure was above the five-point decline that investors had expected, and compared with a 69% reading a year ago.

For soybeans, the proportion seen good or excellent tumbled by eight points to 45%, again more than investors had expected, and below a year-before rating of 66%.

‘Yields are in jeopardy’

The decline reflected more of the hot and dry weather which left most Midwest corn farms with a moisture deficit of two-to-three inches in June alone, according to Gail Martell at Martell Crop Projections.

Selected corn crop condition by state and (change on week)

Indiana: 19%, (-8 points)

Illinois: 26%, (-11 points)

Wisconsin: 50%, (-10 points)

North Dakota: 81%, (-10 points)

Minnesota: 82%, (-1 points)

National rating: 48%, (-8 points)
“Midwest June temperatures were 2-5 degrees Fahrenheit above average, keeping evaporation elevated and causing worse moisture stress. Corn yields are in jeopardy,” she said.

At Phillip Futures, Ker Chung Yang noted that last weekend “there was also wind and hail damage in parts of the eastern Corn Belt”.

And, indeed, crop condition continued to suffer in states such as Illinois, where the percentage of corn rated good or excellent dropped 11 points to 26% over the week, and Indiana, where the decline was of eight points to 19% - the worst reading since the drought year of 1988.

“Several areas of the state [Indiana] experienced record-setting heat during the week with temperatures reaching as high as 107 degrees Fahrenheit in some southern counties,” USDA officials said.

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