 "The USDA's Crop Progress report showed only 48 percent
of the crop planted as of May 10 -- equal to last year's slow
pace and below the five-year average of 71 percent," said Darrel
Good, U of I Extension economist. "So far the corn market has
had only a modest reaction to these planting delays."December
2009 corn futures prices are a bit lower than in early April and
only about 50 cents above the low of the past four months.
The very measured response to slow planting progress may
reflect the market's focus on other pricing factors.
"However, the anticipation of a rebound in U.S. corn exports
and another substantial increase in ethanol use of corn during
the year ahead, along with a more stable stock market and rising
gasoline prices, should all be supportive for corn prices," said
Good.
He says the market may be remembering 2008, when the effects
of some planting delays and some replanting were offset by very
favorable weather in July, resulting in an above-trend U.S.
average yield. In addition, planting delays this year are not as
widespread as last year.
Delays are severe in Missouri, North Dakota and much of the
eastern Corn Belt, but planting has been rapid in the large
corn-producing states of Iowa, Minnesota and Nebraska.
"Yet the market may be underestimating the potential yield
implications of extremely late planting in the eastern Corn
Belt. It appears, for example, that the percentage of the
Illinois crop planted 'late' this year will be the largest in at
least 50 years," said Good.
The yield effect of late corn planting is well documented in
agronomic research, but typically the percentage of the crop
planted late is low enough to have only a small impact on the
state average yield. That may not be the case this year.
The U of I
corn yield model estimates state average corn yield
based on a function of time (trend), percent of the crop planted
late, total precipitation from September through March before
planting, April precipitation, and monthly precipitation and
average temperature for June, July and August. The model
explains about 96 percent of the annual variation in the
Illinois average corn yield from 1960 through 2008. (See
2008
article in PDF file.)
If all of these variables were at average levels for 2009,
including the portion of the crop planted late (14 percent), the
model would project the state average yield at 175 bushels.
This compares with the unadjusted trend yield, based on actual
yields since 1960, of 163 bushels. The forecast based on average
weather is higher than the unadjusted trend because yields in
poor weather years are reduced more than yields are increased in
good weather years.
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The model can be used to forecast the 2009 Illinois average yield
based on actual precipitation from September 2008 through April
2009, the assumption of average weather for June through August, and
the percent of the crop likely to be planted after May 20.
"With only 10 percent planted as of May 10 and a small window of
opportunity for planting last week, it appears that a large
percentage of the crop will be planted after May 20. Assuming 75
percent is planted late, the model forecasts a state average yield
of 157.4 bushels per acre -- almost 22 bushels below the 2008
yield," said Good.
These results might be applied to Indiana and Ohio as well as
Illinois. These three states account for 25 percent of intended corn
acreage this year.
"Each 1 percent change in the percent of the crop planted after
May 20 changes the yield forecast from our model by about 0.3
bushels per acre. The yield penalty could be larger if a substantial
portion of the crop is planted after May 30.
"A generally drier forecast for the remainder of the month,
however, suggests planting could be completed by month's end," said
Good.
He says actual summer weather could offset part of the yield
impact of late planting or could contribute to further declines in
yield potential.
"The 2009 yield forecast is 172.6 bushels per acre assuming 75
percent of the crop is planted late, July and August precipitation
one standard deviation above average, and July and August
temperatures one standard deviation below average," said Good.
"Conversely, the 2009 yield forecast is 134.5 bushels assuming
precipitation one standard deviation below average and temperatures
one standard deviation above average," he said.
[Text from file received
from the University
of Illinois College of Agricultural, Consumer and Environmental
Sciences]
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