Texas Crop and Weather Report – July 9, 2019

Corn, sorghum prices rally on crop uncertainty

COLLEGE STATION – Corn and sorghum prices have rallied in response to weather-related problems in the Corn Belt, but their future remains uncertain, according to a Texas A&M AgriLife Extension Service expert.

Dr. Mark Welch, AgriLife Extension grain economist, College Station, said Texas corn and sorghum growers are reporting better-than-average growing conditions amid higher prices. There is ongoing speculation U.S. corn acres have taken a major hit due to rain-related delays and crop losses in the Midwest.

“Prices are higher than they’ve been in three to five years,” he said. “At this point, producers along the Gulf Coast and Central Texas have a good handle on their yield expectations, and prices have rallied due to concerns about the crop potential in the Corn Belt. So right now, things look positive for Texas grain producers.”

Welch said per-bushel corn futures prices rose $1, from $3.65 to $4.65, between late-April and early June, based on reports coming out of the major corn-producing areas in the U.S.

The U.S. Department of Agriculture’s June 28 report estimated corn acres to be just under 92 million compared to early season surveys, which showed producers intended to plant around 93 million acres of corn. Pre-report trade expectations were for a corn acreage number between 85-89 million.

Corn producers in Texas may fare better than other parts of the country due to uncertain crop conditions in the nation’s Corn Belt. (Texas A&M AgriLife photo by Dr. Jourdan Bell)

Welch said prices dipped following the June report but rebounded as experts agreed it was likely incomplete and more acres failed or were not planted. Another USDA report in mid-August should clarify acres that failed, were not planted or were planted late.

“The acreage number is a real question mark, but so is the yield potential of this year’s crop,” he said. “There’s concern about late-planted acres going into the silking and pollinating stages during August, which is typically hotter and drier. That’s not the time you want corn going into temperature- and precipitation-sensitive stages that could negatively impact yields.”

The uncertainty about the yields in the Midwest, even if the planted acreage is lower than expected, could still be a factor for up or down swings in future prices, Welch said.

Welch said sorghum’s price rally is tied to corn.

“Grain sorghum cash prices fell hard as the trade dispute with China escalated. Domestically, prices this year are considerably higher because it’s tied to feed and feed demand,” he said. “Corn drives the feed grain prices, and sorghum has tagged along.”

Welch said an end to the trade dispute with China would further improve an already positive market for Texas sorghum producers. China was the top destination for Texas sorghum, and its exit from the market has hurt prices.

“Opening trade would be significant,” he said. “It would change the dynamics of the sorghum market, especially for Texas producers who can access ports like Houston and Corpus Christi more cheaply. But more broadly, opening trade would change the dynamics in the grain complex, especially as soybean profitability impacts corn acres in the long term.”

Despite the trade dispute and early season problems for Texas corn and sorghum producers, 

Welch expects them to have good pricing opportunities into the fall.

“The pendulum swings on uncertainty, but we do know Texas conditions are looking good,” he said. “The Panhandle has good moisture, and so in Texas specifically prospects are positive compared to last year.”

AgriLife Extension district reporters compiled the following summaries:

The 12 Texas A&M AgriLife Extension Districts

CENTRAL: Watermelon harvest was in full swing. Harvest was a little late, but yields were excellent. Conditions were starting to deteriorate with lack of rainfall and 90-degree days. Soil moisture was being zapped, and forage on the ground could make for a busy fire year. High temperatures were beginning to show in Coastal Bermuda grass fields, but they were still in very good condition. Brush control was being done. Producers cut and baled hay. Livestock were in good condition. Farmers were able to get into fields to finish up the wheat and oat harvest. Corn and sorghum harvest was poor to good in some areas. There were a few reports of Bermuda grass stem maggots in hay fields. Corn silage chopping started with yields looking good. Corn for grain continued to progress. Grain sorghum looked good with some fields beginning to color. Cotton was growing well with a few fields starting to bloom. Stock pond levels were full. Nearly all counties reported good soil moisture and overall rangeland, pasture and crop conditions.

ROLLING PLAINS: Conditions were warm with some areas receiving up to 2 inches of rain. Cotton fields were behind in overall maturity due to delayed plantings, but overall the crop was in good condition. Pasture and rangelands were in fair to good condition. Wheat harvest neared completion.

COASTAL BEND: Most areas received significant rain, but the southernmost and northernmost areas of the district received little to none. The areas with wet conditions were prime for fungal disease development on all crops, and farmers were vigilant regarding disease control measures. In the southern counties, grain harvest was in full swing with strong yields. Other areas were about one to two weeks from harvest. Corn was rapidly drying down and in the dent stage. Cotton was in full bloom, and additional moisture would benefit yields. Many producers were rolling up good quality hay as weather allowed. There was ample forage in most pastures. Livestock were in excellent condition.

EAST: Less rain and warmer temperatures helped dry out some of the district. Hay production was underway where possible. Harrison and Houston counties were still too wet to access or cure hay. Pasture and rangeland conditions were good. Subsoil and topsoil remained adequate. Gardens were producing well. Livestock were in fair to good condition. Wild pigs and gophers caused damage and other problems. Grasshoppers, armyworms and Bermuda grass stem maggots were reported.   

SOUTH PLAINS: Subsoil and topsoil moisture levels were good to adequate. Farmers continued to spray for weeds and pests and monitored irrigation. Cotton acres were down due to rain, but acres planted in mid-May were fine. Many fields were affected by seedling disease. Replanted acres were running a month behind schedule. In other counties, cotton ranged from two true leaves to 11 true leaves, with match-head sized squares. Most peanuts were blooming. No worm damage was noted to date, though various moths and millers were reported in fields. Rangeland, winter wheat and pastures were in good condition. Cattle were in good condition.

PANHANDLE: Scattered rain and hail events halted wheat harvest, but yields for dryland and irrigated acres were outstanding so far. Cotton development was rapid with excellent moisture and heat units. The cotton crop was in dismal shape with approximately 80% of planted acres lost due to early and ongoing weather events. Some cotton acres were replanted with grain sorghum or early season corn varieties. The corn crop was behind schedule. Rangelands and pastures were green and lush, and cattle were in excellent condition.    

NORTH: Soil moisture was mostly adequate across the district. Conditions were hot and dry with temperatures in the upper 90s. Some areas received trace amounts of rain up to a half-inch. Hay producers were taking advantage of drier conditions and were busy cutting and baling. Producers expected high hay production this season. Some Sudan/haygrazer patches looked a little yellow and stunted due to standing water. Pastures were in good shape but could use a timely rain. Corn was slow in turning brown and drying with all the moisture and high humidity. Most corn fields looked decent, and producers were hopeful for above-average yields. Some sorghum looked good while other fields were poor, but most of the crop was heading. Some fields needed water. Wheat and oat harvests were complete and above average. Soybeans looked good and were loaded with pods. Cattle looked good.  A few stocker calves were still on summer pasture. Cow/calf breeding season was just about over for most producers. Some producers were spraying for grasshoppers. 

FAR WEST: Temperature highs were in the lower 100s with lows in the upper 70s. Precipitation was slight with scattered thunderstorms delivering up to 1 inch in some areas. Harsh winds were drying soil and grasses out. This caused an increase in fire danger for overgrown areas such as right of ways. Past rains were keeping most rangelands green. Small amounts of cotton were up and in fair condition. Pecan trees were showing clusters of four to five pecans. Livestock were fair to good as producers continued to feed livestock and wildlife. 

WEST CENTRAL: Conditions were hot and dry. Hay producers continued to cut and bale haygrazer fields. Grain sorghum and corn looked good. Most livestock were in good condition and stock tanks were full. Stocker and feeder steers and heifers in good condition sold steadily at market. Fleshier feeder steers, heifers and calves sold $2 lower.

SOUTHEAST: Some areas experienced heavy rains for multiple days. Conditions were hot and humid. Rangeland and pasture ratings were excellent to poor with good being most common. Soil moisture levels throughout were adequate to surplus with adequate being most common. 

SOUTHWEST: No rain was reported. Some counties reported declining rangeland and pasture conditions due to high temperatures and no rain. Conditions helped dry out fields previously inaccessible due to flooding. In other counties, rangelands and pastures continued to do well thanks to weeks of rain. Cotton looked good in most counties. Wildlife and livestock were in good shape.

SOUTH: Northern parts of the district reported hot weather with short to adequate soil moisture levels. Eastern and western parts of the district reported hot and dry weather conditions with adequate to very short soil moisture levels. Hot weather conditions were reported in the southernmost part of the district with short soil moisture levels. Cotton was blooming. Early planted peanuts were starting to peg. Cornfields were being prepared for harvest. Pasture and rangeland conditions were fair to good. Live Oak County reported 60% of the county received a very beneficial rain of 1.5-5 inches. Irrigated Coastal Bermuda grass fields were producing good hay bales. Pecan orchards were in good condition and being irrigated with no significant reports of pest or disease problems. Irrigated crop fields like watermelons and cantaloupes were still producing well. Cotton producers in Zavala County were busy irrigating. Pasture conditions continued to deteriorate in Zapata County, and producers were hauling water and feeding hay and cubes. Grain harvest began in some parts of Jim Wells County. Yields looked good with some variability reported. Most pastures still had standing forage, but quality was drastically affected by the lack of rain. 

 

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