From the Ground Up: Uncertainty Surrounds the 2019 Corn Crop
Many Texas farmers experienced one of their wettest years ever in 2019 and that wet weather also extended into the Midwest where most U.S. corn is grown. While most producers will be glad to put last year behind them, it seems to be lingering and causing some uncertainty for the corn market in 2020. Mark Welch is a Texas A&M AgriLife Extension Grain Marketing Economist.
“It’s been a struggle since last spring. It was wet, sloppy, trying to get the crop planted, record rainfall across much of the Midwest. The crop went in late. Harvest conditions weren’t much better. There’s still crops in the field. We’ve got snow packed around corn. So it’s a year that we’d like to get behind us, but it’s one that I think is going to stay with us for a while yet as we move into 2020.”
Welch says that USDA estimates on the size of the 2019 corn crop went up a little in January from what they were in December, noting there’s uncertainty about how big the crop was.
“But I think one issue going forward that’s going to be important for market support and market direction is what is the quality of that 2019 corn crop? We know a lot of it went in the field late and it came out of the field wet. We’re looking at low test weights and so that starts to affect some storage issues. And so we don’t have a crop that went in the bins in the highest quality and so that does have some implications of the pounds of grain that went in versus the pounds of grain that are going to come out?”
Welch says that may raise some uncertainty about what those grain stocks numbers will be as we move through the early spring.
“Will it take more pounds of that corn to produce a pound of beef? Will it take more pounds of that corn to yield a gallon of ethanol? And so that could affect some consumption patterns as well moving into 2020. So I think that uncertainty around what the size of last year’s crop was is going to give us an undertone of some degree of market support as we go through early this spring.”
And that just adds another piece to the puzzle that farmers face in their 2020 marketing efforts.