Crops, markets get center stage at Dakotafest
MITCHELL, S.D. — "Crazy, ridiculous, historic, by far."
Those were the words used by Dave Fogel said to describe the 2019 crop year. His Dakotafest talk on Tuesday, Aug. 20, at the Schlaffman Farm show site was about 2019 being "a year of disaster and profitability."
Fogel, a vice president for Bloomington, Ill.-based Advance Trading, Inc., said people he's talked to have looked for other years to compare this to, but he's concluded that there's never been anything else like this in his 37-year career.
"We've never had this type of disaster and messiness and confusion and just a bunch of unknowns," Fogel said.
At the nearby South Dakota State University Extension tent, Crops Business Management Field Specialist Jack Davis said he thought farmers have managed to get more corn planted this year than expected. Davis brought a cornstalk from his field near Woonsocket to show the audience what condition the corn was in, which he said was fairly mature at this time of year in the growing season.
In South Dakota, 64%of the corn was planted as of June 9. That's a drastic decline from the previous year's 96% of corn that was planted in early June 2018, according to the National Agricultural Statistics Service.
"A lot of our corn in South Dakota got planted late, and I think it's going to be pretty hard to estimate a yield based on the late planting," Davis said, noting it won't be until the fall harvest that he can get a better feel for what the yields will be toward the end of the year.
Of course, there have been estimates. Fogel also addressed the Monday report from the Pro Farmer Midwest Crop Tour that estimates yields in seven Midwest states. While that tour is just starting, it was the western and eastern ends of the scouting tour — South Dakota and Ohio — that have fared poorly.
It reported South Dakota was down to 154 bushels per acre in corn and about 833 soybean pods per 3-foot-by-3-foot square. A year ago, the averages were 178 bushels per acre in corn and 1,024 soybean pods per square. The three-year tour average is 158.59 per acre for corn, and 964.96 per square for soybean pods.
Fogel was skeptical at how much impact that tour would have for the market, and said he's more trusting of the U.S. Department of Agriculture's National Agricultural Statistics Service farmers survey.
"Really, I don't think anyone impacts the market," Fogel said of the tour. "They don't really cover a lot of acres, relative to USDA. But there's so much more that goes into the price. Half of the market is just people that trade off computers that wouldn't know a bean field from a corn field."
The USDA, in its crop production report issued earlier this month, estimated South Dakota to have yields of 157 bushels of corn per acre, down three bushels from 2018, and 45 bushels of soybeans per acre, down one bushel from last year. But the corn and soybean acreage to be harvested this year was down 17 and 38%, respectively, for each crop.
Nationally, the USDA's National Agricultural Statistics Service has forecasted soybean production to be down 19% and corn to be down 4 % from 2018. From a market standpoint, Fogel cautioned those believing there's more crops out there that have not been counted.
"There's people banking on the USDA being wrong," he said. "That hasn't worked historically ... The USDA, that's the one the markets watch."
Davis said he was surprised the nation reached 90 million acres of corn planted, but said that was a testament to how much work was done in early June.
"When the report first came out, I said, 'How in the heck can we have gotten 90 million acres planted?'" Davis said. "But as I read into it more, I believe it's accurate because a lot of it got planted in June 1 through June 12."
Fogel remarked about the high levels of prevented planting in South Dakota. For example, in his home state of Illinois, it ranks as the No. 2 prevented planting state in the country for 2019. South Dakota is No. 1.
"Unfortunately, you guys are leading the way," he told the small crowd that gathered.
Fogel said everything will be about frost and maturity for how crops come out in the fall, considering so much planting was done in June after a wet spring. He said his company bases its analysis on talking to country elevators around the Midwest, and talking to farmers about managing price.
Fogel said that with the farm economy in rough shape, it becomes that much more important to tune out a high level of noise in the markets, something that is easier said than done. He said making the right move at the right time in a volatile year can help set up a farmer to get through four or five mediocre years.
"It's not fun, but it's manageable," he said.