Corn futures for December delivery rose 0.5 percent to $8.1125 a bushel at 8:12 a.m. on the Chicago Board of Trade. The price reached an all-time high of $8.49 on Aug. 10. Soybean futures for November delivery advanced 0.7 percent to $16.57 a bushel on the CBOT. The most-active contract reached a record $16.915 on July 23.
Drought has affected 87 percent of U.S. corn, 85 percent of soybeans, 63 percent of hay and 72 percent of cattle, the National Climatic Data Center said on Aug. 16.
Increased rain from South Dakota to Ohio and cooler weather than the record-setting heat of July will reduce the chances for additional cuts in the government’s corn forecast and may mean a boost for soybeans, said Dale Durchholz, the senior analyst for AgriVisor LLC in Bloomington, Illinois.
The government’s crop forecasts this month reflected the biggest August reductions since at least 1974. In 1988, the final corn forecast increased 9.1 percent from the August estimate and soybeans gained 4.8 percent rains helped to boost yields, Durchholz said.
The wetter August weather pattern may be tied to rising eastern equatorial Pacific Ocean waters and the emergence of an El Nino weather condition, Gail Martell, the president of Martell Crop Projections in Whitefish Bay, Wisconsin, said in a report Aug. 16.
“The rains have at least stabilized the corn crop, and soybeans may add a few bushels,” Durchholz said. “The big USDA cuts probably account for most of the drought losses.”
Thriving, green soybean plants next to fields of brown and dead corn may be a sign that yield potential is lower than expected, Bill Wiebold, a soybean agronomist at the University of Missouri in Columbia, said in a report on Aug. 8.
Visually healthy fields may be the result of high nitrogen levels in leaves because there are fewer pods to fill with soybeans, Wiebold said in the report. The plant requires a steady flow of water moving up roots to the pods to produce beans. The prolonged drought may have caused soybean blossoms to abort and no pods for the seeds to develop.
“When there is no water, the system stops working,” Wiebold said. “That has happened in many soybean fields. We just have not experienced anything quite like this before.”
Donna Jeschke, 59, who farms about 3,600 acres with her husband, brother and nephew about 80 miles southeast of Chicago near Mazon, Illinois, said she expects the farm’s corn yields will be 50 percent below the five-year average of 190 bushels an acre, while soybean yields may fall 15 percent.
Damaged crops may not mean losses for growers as government-subsidized crop insurance and higher prices helps to partially preserve farm income, the Federal Reserve Bank of Chicago said in a report Aug. 16.
“Crop insurance will allow farmers to pay their bills and buy inputs to plant crops the next year,” Jeschke said. “Farmers have to be optimists and look ahead to better weather next year.”
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