Corn Update – August 29, 2017

The CropProphet forecast for U.S. corn now shows a high probability that the national average yield will be excellent for the fourth consecutive year. The most likely U.S. yield has again risen slightly in the past two weeks and currently stands at 174.2 bushels per acre, which is very close to last year’s record (see figure below). The risk of seriously damaging weather in the remainder of the growing season is now very small, and the lower limit of CropProphet’s 90% confidence interval has risen rapidly in recent weeks as the most unfavorable scenarios have been progressively ruled out. However, it is worth noting that the upper limit of the confidence interval has decreased slightly as the most highly favorable scenarios for corn yield have also been eliminated; for example, it is now less likely than in late July that U.S. corn yield will exceed 180 bushels per acre for the first time.

 

 

The most significant change in the corn outlook over the past two weeks is the improvement in South Dakota, where widespread heavy rainfall brought relief from the drought and allowed the state’s yield forecast to increase rapidly (see figure below). Remarkably, the yield forecast for South Dakota has increased by over 10 bushels per acre since the beginning of August and has almost reached the long-term trend-line value (see figure below). The yield forecast for Iowa has also improved slightly as much-needed heavy rain occurred in the western part of the state; however, significant long-term moisture deficits persist in the south-central and southeastern districts of Iowa.

 

 

 

The weather outlook component of CropProphet shows mixed signals for the likely change in corn prospects over the remainder of the growing season. Slight reductions in yield appear likely in the Upper Midwest in the next two weeks, as very cool weather will persist; below-normal temperatures become unfavorable for corn yield in northern growing areas in September. However, the longer-range outlook for the full month of September is considerably warmer and suggests that the U.S. yield may end the season above 175 bushels per acre (see figure below). Clearly this more favorable scenario will become more likely if the weather pattern changes soon, bringing an end to the persistent flow anomaly that has led to the coolest August since 2004 for U.S. corn growing areas.

The next update to the corn commentary will occur on September 12.