Iowa farmers resumed harvesting corn and soybeans this week, thanks to sunny, windy weather on Monday and Tuesday. Most of the state's soybeans and half of the corn had been harvested by October 22, according to the weekly crop survey conducted by Iowa Ag Statistics Service. Both crops are lagging behind last year's harvest pace.
The weekly survey results, released by the government agency on October 23, show that Iowa farmers had harvested 48% of the state's corn crop by Sunday October 22, up from 31% the previous week but short of the 57% of a year ago and the 5-year average of 49%.
Also by Sunday, Iowa farmers had harvested 91% of the soybeans in the state, compared with 87% a week ago, 96% a year ago and 91% on average.
Weather clears up, as prices go up
Nationally, 53% of the corn had been harvested as of Sunday, up from 41% a week earlier, but behind last year's 63%. Also by Sunday, 76% of U.S. soybeans had been harvested, compared with 69% a week ago and 85% a year ago.
Statewide, rainy and cool temperatures slowed crop drying and harvest activity last week. In Iowa, temperatures averaged 43.7 degrees last week, 6.3 degrees below normal. In addition, statewide rainfall averaged 0.81 inch. "So these nice days for harvesting on Monday and Tuesday of this week were really welcome," says Harry Hillaker, state climatologist at the Iowa Department of Agriculture.
Farmers are happy about prices for crops at harvest this year. Corn and soybean prices usually sag during harvest but they have been rising this year, despite the largest U.S. soybean crop and the second largest U.S. corn crop on record.
Market is treating it like a short crop
"I've farmed for 35 years and I've seen prices rise during harvest only a few times in all those years," says Richard Harves, who farms in Clay County in northwest Iowa. "It was in the years that we had a short crop that you saw prices rise during harvest. This year we have a big crop and yet the prices have risen significantly. This is really unusual to have such strong grain prices at harvest."
"The reason is because the market is being driven by strong demand this time," notes Harves. "Weekly corn exports are increasing, ethanol demand for corn continues to explode, and livestock feeders are strong buyers because they want to get hold of the grain to meet their needs for the coming year. The world wheat situation is very tight too, which adds to the bullishness for corn. And that bullishness is spilling over for soybeans. Beans are going along for the ride."
Despite the big corn crop this fall, corn demand is projected to be a billion bushels higher this marketing year, largely driven by ethanol demand. Market analysts say U.S. corn acreage needs to increase by at least 8 million acres in 2007 to meet next year's expected demand. "Corn prices will to have to stay strong through this fall, and winter and into spring, if the market is going to get farmers to plant more corn acres and less soybeans and wheat," says Harves.
Corn and soybean prices rose on Monday. In Iowa, cash corn prices averaged $2.78 per bushel, up 6 cents, while cash soybean prices averaged $5.64 per bushel, up 14 cents. "Those are pretty good prices at harvest," he notes, "especially with the large crops we have this fall."