CORN PRICES WILL FOLLOW SUMMER WEATHER, SAYS ANALYST.

This year's corn planting has been a struggle for many, as wet conditions and cool temperatures have either delayed planting or growth. Stand count could be an issue, and this may have been relayed in this week's Crop Progress report released by the USDA on Tuesday, May 30.

Perhaps what stood out on the report was the corn crop condition numbers, even more so than the planting progress numbers (at 91% for the top 18 producing states versus a 5-year average of 93%). Corn rated poor to very poor: 15% in Illinois, 17% in Indiana, 9% in Wisconsin and 12% in Ohio. Yes, it's early in the season. Yet, with a start like this, one can't help but wonder if trend-line yield expectations of 171 bushels are even possible.

If the last decade has taught us anything, it’s that the resilience of farmers, the technologies involved with growing a crop, and cooperative weather all suggest that yield potential is on the rise, and a large and dependable crop will be at hand. Still, Mother Nature does hold the final say. With a prevent plant date for some northern states of June 1, the combination of less-than-ideal spring conditions and the reality that some acres of corn will be switched to soybeans (or not planted at all) could set the stage for a smaller crop.

As summer weather goes, so will prices. If conditions improve, expect little rally potential in corn. At the same time, be prepared for downside potential, as projected carryout will still be viewed as adequate, despite lower acreage. Last year's low in December corn was 3.15. A drop from current levels to the 3.25 area shouldn't be a shock to anyone this year. However, if weather becomes more of a factor, look for the possibility of corn prices rallying faster and further than most expect.

A quick view of the cattle market over the last 3 months is certainly reflective of how a market can change from a very bearish oversupply concern to not enough inventory and a raging bull market. With record demand, corn futures could rapidly move higher, as managed money (which is significantly short the market) switches from short to long, and traders factor in weather issues. Buy stops will likely get triggered, and those that are holding corn in storage could become reluctant sellers, looking for higher value.

For you, as a corn producer, the key is a balanced approach to handle this. Reward rallies and buy calls to protect sales. Our suggestion is to purchase out-of-the-money call options now. If summer weather becomes an issue and prices rally, be disciplined and make sales at designated points. The call options will retain ownership.

If you have questions or comments contact Top Farmer at 1-800-TOPFARM, ext. 129.
Futures trading is not for everyone. The risk of loss in trading is substantial. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Past performance is not necessarily indicative of future results. BY BRYAN DOHERTY.

FARMERS GRAIN MARKETING PRACTICES VARY LITTLE, STUDY FINDS.

The latest results from a grain marketing survey conducted by a private firm show similar farmer characteristics that cropped up in Successful Farming’s Benchmarking Marketing survey in 2013.
While the two surveys used different parameters to reach their results, it is interesting to note how they compare when conducted four years apart.

Farmers feel satisfied to mostly satisfied with their grain marketing performance, and larger farmers tend to use more marketing tools than smaller operators. Those were just a few of the survey findings announced this week by Farm Credit Services of America (FCSAmerica), a financial cooperative owned by agricultural producers.

The survey went out to 650 grain producers in nine states throughout the Corn Belt.
At a time when many farmers have worked to lower their operating costs, the survey offers insights about how to optimize the income side of the farm balance sheet, FCSAmerica stated in a press release.

“The survey results highlight that knowing cost of production is the foundation of sound marketing,” said Doug Stark, president and CEO at FCSAmerica, in a press release. “They also highlight the important role that crop insurance plays in supporting both risk management and marketing, not just when there is a crop failure.”

While the FCSAmerica survey found that one third of producers are mostly or completely satisfied with their marketing practices and results, that is lower than the 2013 Successful Farming grain marketing survey that found over three fourths of 1,100 Corn Belt farmers rated their grain marketing performance good-to-excellent.

FCSAmerica’s survey revealed that satisfied marketers are more likely to price as soon as the market offers a profit and to price multiple crop years. They are less likely to sell most of their crop right after harvest or to price based on market fear or cash flow needs, according to the FCSAmerica’s survey results.

Interestingly enough, the 2013 Successful Farming marketing survey highlighted that 33% of farmers’ primary goal in marketing is to manage risk; 20% marketed to enhance price.
Other findings of FCSA’s survey:

– More satisfied than dissatisfied marketers report that they have a good understanding of their cost of production and use it to set an initial price goal. Satisfied marketers are more likely to have written marketing plans.

— On average, producers use four to five marketing tools, the most popular being storage. Also, 82% store grain at least occasionally; one in five always stores.

— Operations of 1,000 or more acres and growers with higher levels of crop insurance employ a fuller range of marketing tools. Producers with revenue protection of at least 80% also are more likely to price prior to harvest.

— More than two thirds use cash forward contracts and spot cash sales; only a quarter of respondents use futures or options.

In 2013, the Successful Farming Grain Marketing Survey results mirrored the FCSAmerica’s survey trends on the use of grain marketing tools. SF’s survey found that 84.1% farmers used cash sales, 47.8% used forward cash contracts, and only 26% used futures contracts.

FCSAmerica’s survey found those 35 and younger are more likely to use hedge-to-arrive contracts and lock in the carry when they store. Younger and larger operators are more likely to use their cost of production to set a marketing price. BY MIKE MCGINNIS.

SMARTER S700 COMBINES, HEADERS INTRODUCED BY JOHN DEERE.

From front to back, John Deere’s 2018 S700 combines, as well as its new headers, feature the most advanced grain-harvesting technology. The series includes four models – S760, S770, S780, and S790 – and have been equipped with improved smart technology and operator comfort.

These machines build on the proven performance of the S600 combines introduced in 2012 and include the latest in automated harvesting technology. A number of these improvements make it easier for you to make adjustments automatically on-the-go.

“These new S700 combines are a culmination of enhancements to our previous model that optimize and automate harvesting operations for coarse and small grains,” says Kevin Ripple, marketing manager for harvest at John Deere. “We’ve enhanced the overall intelligence of these combines by automating more adjustments and calibration tasks, and improved the lifetime durability and productivity of front-end equipment to create a high-performance harvesting solution unlike any other on the market today.”

Combine Advisor

In an effort to maximize the performance of the S700 combines, John Deere has developed the Combine Advisor package. This package incorporates seven technologies to help you set, optimize, and automate the combine to enhance harvesting performance based on crop and field conditions.
One of the functions within Combine Advisor, Auto Maintain is supported with ActiveVision cameras. “These cameras give you a view into the tailings and clean grain elevators via the display, and analyze the information to maintain optimal threshing performance based on operator-set targets,” Ripple explains.

Another feature, Active Yield technology, automatically calibrates the mass flow sensor. This saves time by eliminating the need for manual calibrations and ensures that the best data is collected.
Moving inside, one of the first things to catch your attention will be the new state-of-the-art CommandCenter. This system provides a uniform user experience across the company’s larger tractor and self-propelled sprayer lines, and it underscores customization and operator comfort.

Highlights of the CommandCenter include a Gen 4 interface and monitor with 4600 processor, CommandArm and multifunction control lever with greater ergonomic design and customizable buttons, premium activation with AutoTrac, RowSense and HarvestDoc, and Extended Monitor and mobile device features. Due to more intuitive harvest run and setup screens, setup and start-up are quicker and easier.

You can choose between leather or cloth seats that swivel 7½˚ left and 15˚ right for improved visibility. Seats also feature enhanced ventilation for greater comfort. From the seat, you’ll also notice added grain tank mirrors for improved visibility.

Corn head and platform

Along with the S700 combines, John Deere is introducing the 700C/FC (folding corn head) series corn heads with the RowMax row unit. This row unit provides up to a 50% increase in the life of the gathering chains and includes solid-alloy bushings that reduce pin and bushing wear.

“We’ve also increased the life of the stalk rolls by up to 25% by utilizing a harder material and adding a new wear coating on the front and trailing edges of the blades for increased performance,” says Brittney Guidarelli, product manager for front- end equipment. “As a result, we’ve decreased the cost of operation by reducing how frequently wear parts need to be replaced. You will experience a savings of up to $20,000 over five years compared with previous models.”

The 700C corn heads are available in 6- to 18- row models and in 20-, 22- and 30-inch row widths. The StalkMaster stalk-chopping option is available on all models. Folding corn heads are available on 8- and 12-row units.

If you harvest high-moisture corn, there are several enhancements on the corn head to handle this crop, including an auger floor insert to ease crop handling and a lower auger height to minimize crop damage.

For small grains, Deere introduces the 700D Rigid Draper, which provides a 20% increase in capacity in tough harvesting conditions over its predecessor. The 700D features a top crop auger that’s 50% larger in diameter (now 18 inches) with heavy-duty drives, high-performance gauge wheels, and a center-section seal kit that reduces center-section grain losses by up to 45% in canola.
       
“The new S700 combines are ideal for producers who want to get the most out of their combine, regardless of operator experience or changing field conditions, with quick harvest setup and automatic on-the-go adjustments,” says Cyndee Smiley Dolan, division marketing manager. “The technology, control, and comfort features integrated into this new combine and heads make it the most effective and efficient grain-harvesting solution available.” BY LAURIE BERDORD.

WARM, DRY WEEK MAY STRESS NORTHERN U.S PLAINS SPRING WHEAT

CHICAGO, June 2 (Reuters) - Warm and dry weather is expected to persist in the northern U.S. Plains Spring Wheat Belt through next week, potentially stressing developing wheat, corn, and soybean crops, agricultural meteorologists said.

“It’s dry for the next 10 days, for the most part,” David Streit, a meteorologist with the Commodity Weather Group, said on Friday. “The complicating factor is a fair amount of heat starting to happen up there as well. That’s going to compound the dryness issue.”

Temperatures should reach the 90s Fahrenheit (32° Celsius) this weekend and again next weekend, Streit said.

Dry conditions have recently intensified in the Dakotas and eastern Montana, even as excessive rains have swamped fields farther south, in the southern Plains and the Midwest.

The weekly U.S. Drought Monitor, prepared by a consortium of climatologists, showed 24% of North Dakota was in “moderate drought” as of May 30, up from 6% a week earlier. Nearly the entire state - 99.9% - was rated “abnormally dry,” up from 44% the previous week.

North Dakota is by far the largest producer of spring wheat, a high-protein variety used for bread and for blending with lower-quality wheats.

Grain traders are monitoring the health of the newly planted spring wheat crop in light of concerns about the quality and protein content of the U.S. hard red winter wheat crop, which is being harvested this month in the southern Plains.

If protein levels in the winter wheat crop are low, millers will turn to spring wheat to boost the quality of their flour blends.

Spot spring wheat futures on the Minneapolis Grain Exchange reached $5.90 per bushel on Friday, the highest since January. The premium for spot spring wheat futures over K.C. hard red winter wheat futures was $1.53 per bushel, the widest since December, underscoring fears about supplies of high-protein wheat.

The spring wheat crop was 96% seeded and 79% emerged by May 28, the U.S. Department of Agriculture said. The government rated 62% of the crop as good to excellent, down significantly from 79% a year earlier.

“Hot and dry weather is not unusual in western North Dakota or Montana, (but) this early is the concern,” Jim Peterson, marketing director with the North Dakota Wheat Commission, said on Friday.

For the most advanced spring wheat fields, Peterson said, “You’re already going to temper your yield potential, even if rains do come later.” BY JULIE INGWERSEN.