FOCUS ON AG

Written by Kent Thiesse

Farm Management Analyst and Vice President, MinnStar Bank
July 8, 2019

CROP CONDITIONS IMPROVE IN SOME AREAS

Warmer temperatures in late June and early July have helped improve the crop conditions in some
areas of the Midwest. Earlier planted corn has made up some lost ground as far as crop development,
while later planted corn and soybeans have experienced very rapid growth. However, many areas of
Southern and Western Minnesota, along with adjoining areas of Northern Iowa and Eastern South
Dakota have been impacted by severe storms and excessive rainfall amounts in recent weeks, including
hail in some locations. This has caused considerable drown-out areas in some fields, as well as crop
damage to remaining acres in many fields. Crop conditions remain quite variable across the region.

Other than the heavy rainfall events, late June and early July featured normal to above normal
temperatures, which has allowed for rapid development of corn and soybeans in many areas of the
Upper Midwest. As of July 3, the accumulated growing degree units (GDU’s) at the University of
Minnesota Research and Outreach Center at Waseca since May 1 was at 881.5 GDU’s, which is still
approximately 10 percent behind normal. However, this is a big improvement from early-June, when
the GDU’s at Waseca were 23 percent behind normal. The GDU accumulation in 2019 at Waseca is
still well below the 2018 level, when 1143.5 GDU’s had been accumulated by July 3.

The continued heavy rainfall events in late June and early July in many areas of Southern and Western
Minnesota have hampered crop development and caused additional crop loss. Most of the affected
region received 100 to 150 percent, or more, of their normal precipitation amounts since May 1, with
heaviest rainfall events coming since mid-June. For the year, many areas have now received 20-30
inches of precipitation during 2019, with portions of Southeast and Western Minnesota getting 5-10
inches of rain since June 25. In some areas of Southwest Minnesota and Eastern South Dakota, farm
operators did not complete their 2019 corn and soybean planting until late June. There is a considerable
amount of prevented planted acres in many locations across the region.

A major concern that is developing as a result of the late planting and excessive levels of rainfall is the
loss or lack of available nitrogen for the growing corn. Soil nitrogen losses increase substantially
during heavy rainfall events early in the growing season, such as have occurred in the past few weeks.
In some cases, farmers planned to side dress the nitrogen after planting, but have been unable to do so
due to the continual saturated field conditions. Farmers may need to evaluate the condition of the corn
crop before deciding how much to invest in supplemental nitrogen applications for the 2019 corn crop.

Another concern with the persistent wet field conditions is timely herbicide applications for weed
control. Producers that were relying totally on post-emergence herbicides for weed control have had
difficulty getting these products applied in a timely fashion, which is resulting in strong weed pressure
in some fields. We have already passed the time window for dicamba herbicide in soybeans, as well as
for some other post-emergence herbicides used in corn and soybeans. Producers should contact their
agronomist or crop consultant regarding further considerations for late season post-emergence
herbicide options for this year’s crop.

The weekly USDA Crop Condition Report on July 1 listed 58 percent of Minnesota’s corn crop and 62
percent of the soybeans as “good to excellent”. The crop rating the State has been fairly steady since it
was first released in mid-June. By comparison, the “good to excellent” crop ratings in Minnesota at
this time in 2018 were 84 percent for corn and 79 percent for soybeans.
Confusing USDA Acreage Reports
The 2019 acreage reports that were released by USDA in June were quite confusing, both for farmers
and grain market analysts. The USDA World Agricultural Supply and Demand Estimates (WASDE)
Report released on June 11 lowered the expected planted corn acres in the U.S by 3 million acres from
May to June, with the 2019 planted corn acres now estimated at 89.8 million acres. However, the
USDA National Agriculture Statistics Service (NASS) Crop Acreage Report, which was released on
June 28, only showed a decline of only 1.1 million acres from the intended planted acres in March,
with 91.7 million planted acres of corn listed for 2019. The NASS corn acreage number exceeded the
estimates of grain traders by 5 million acres and was 2 million acres above even the highest estimate.

How does one explain the vast difference in the planted corn acreage by different USDA agencies ?
One explanation is the difference in how the corn acreage data is collected. The NASS data is based on
farmer surveys, which were conducted during the first half of June and could have changed by late
June. It is also not known how farmers considered prevented planted corn acres in their estimates. The
WASDE reports are released the middle of each month, with planted crop acreage estimates and other
data compiled by USDA economists, based on their analysis of existing crop conditions.

USDA has announced that it will re-survey farmers in 14 States, including Minnesota, in July to update
the corn and soybean planting data for 2019, with the updated NASS acreage report to be released in
early August. The June 28 NASS acreage report lowered the intended 2019 U.S. soybean acres by
about 4.5 million acres from the March estimate. So, in total, the planted U.S. corn and soybean
acreage in June declined by nearly 5.7 million acres from the original acreage estimate in March. This
probably somewhat reflects the 2019 prevented planted acres, though many experts feel that number
could end up a lot higher.

The next WASDE Report will be released on July 11, with many grade traders watching to see if there
are any further adjustments in 2019 corn acreage. The June WASDE Report also lowered the expected
2019 U.S. average corn yield to 166 bushels per acre, which was a decline of 10 bushels per acre from
the May estimate. Grain traders will also be watching this number very closely. The crop reporting
deadline for farmers at local Farm Service Agency (FSA) offices is July 15, which may provide
another indication of 2019 planted crop acres, as well as the amount of prevented planted acres. Most
likely, we will not have certainty on the 2019 crop acres until after the corn and soybean harvest is
completed this Fall.

**********************************************************************************
Note --- For additional information contact Kent Thiesse, Farm Management Analyst and Senior
Vice President, MinnStar Bank, Lake Crystal, MN. (Phone --- (507) 381-7960);
E-mail --- kent.thiesse@minnstarbank.com) Web Site --- http://www.minnstarbank.com/