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Grains: 2025 Crop Tour Final Results · Professional Ag Marketing Podcast

• 0:00
  SPEAKER_01: Welcome to the 2025 Professional Egg Marketing Crop Tour brought to you by Green Key Egg.
• 0:05
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• 0:07
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• 0:22
  SPEAKER_01: Reach out to NOAA at 712-441-5446.
• 0:27
  SPEAKER_01: Well, today is August 8th.
• 0:28
  SPEAKER_01: I've got Jaden here with us.
• 0:30
  SPEAKER_01: We're going to talk about a final, final crop tour review here.
• 0:35
  SPEAKER_01: We're going to give you our final crop tour number.
• 0:38
  SPEAKER_01: Alright, Jaden, this was your second year.
• 0:40
  SPEAKER_01: This was my tenth year on the professional ag marketing crop tour.
• 0:44
  SPEAKER_01: We covered eight states, about equivalent to what was it, 2300 miles, something like that.
• 0:49
  SPEAKER_01: We put on our crappy little rental car, which those prices have come down through the years, which is worth noting.
• 0:56
  SPEAKER_01: But we're just going to talk about a recap.
• 0:58
  SPEAKER_01: We're going to give our final yield estimate.
• 1:00
  SPEAKER_01: We're going to talk about what yields normally do from July to August WASDAs, what how close uh our reports are versus the August WASDA normally.
• 1:09
  SPEAKER_01: And then just general thoughts, too.
• 1:10
  SPEAKER_01: So let's start it off with just a recap.
• 1:13
  SPEAKER_01: We started day one, worked our way through Nebraska, Western Iowa, into Missouri, all the way east through Illinois, Indiana, Ohio, then wrapped back all the way towards kind of eastern Iowa and then uh up to Minnesota uh to finish out.
• 1:28
  SPEAKER_01: So in general thoughts, we did that.
• 1:31
  SPEAKER_01: Lucas Peters on the last podcast, he talked about the Northern Crop Tour where they had gone through mainly the I-90 corridor, a little bit of eastern South Dakota and whatnot.
• 1:40
  SPEAKER_01: Uh so very close to home there on those crop tours.
• 1:43
  SPEAKER_01: But in general, anyways, we came out with a what yield, Jaden.
• 1:48
  SPEAKER_00: Yeah, Mike, we came out with a 184.6.
• 1:51
  SPEAKER_01: No, 184.6, I would say, given acreage uh discrepancies based on tenure harvested acres on average versus what the USDA has.
• 2:03
  SPEAKER_01: It's somewhere that makes about a half a bushel difference.
• 2:05
  SPEAKER_01: So you could say either way of 184 to 185 is pretty much where we had come out there at.
• 2:12
  SPEAKER_01: But overall, yeah, 184.6.
• 2:15
  SPEAKER_01: So I want to compare this to a few things.
• 2:18
  SPEAKER_01: One, what did Stone X come out with in their model?
• 2:21
  SPEAKER_00: Yeah, Mike, they came out with a 188.1.
• 2:24
  SPEAKER_01: Okay, Stonex came out with that.
• 2:26
  SPEAKER_01: Uh, based on other uh formatting, other people coming out, I I want to mention something.
• 2:34
  SPEAKER_01: Uh vegetative health index, that is putting us around a 189.2.
• 2:41
  SPEAKER_01: So that uh is something else I want to talk about as well in a little bit.
• 2:45
  SPEAKER_01: But nonetheless, our average range is somewhere between 181 to kind of 189, kind of I would say for average people uh guessing on where this corn crop is gonna be.
• 2:56
  SPEAKER_01: But a pretty wide general guess, very wide.
• 2:59
  SPEAKER_01: So our going into that doesn't mean that's what we think they're gonna come out with on Tuesday's report next week, because average trade guess there's like 184.3.
• 3:09
  SPEAKER_01: So it's actually pretty close to our number.
• 3:11
  SPEAKER_01: But um one of the things I wanted to talk about was Stonex at a 188.1 JD.
• 3:19
  SPEAKER_01: How close are they with their number um to the August uh August example for it, at least on the WAS day and final, maybe even?
• 3:28
  SPEAKER_00: Yeah, Mike.
• 3:29
  SPEAKER_00: So normally when when they guess high on on the WAS day, they're normally like 1.3 bushels off.
• 3:37
  SPEAKER_00: And uh when they guess low, they're normally about 0.8 bushels off.
• 3:40
  SPEAKER_01: Now that is a very close standard aviation.
• 3:43
  SPEAKER_01: If you look at in 24, 23, 22, 21, 20, like they've been close on all those years.
• 3:50
  SPEAKER_01: They are not far off, they're within a bushel or two every one of those years.
• 3:54
  SPEAKER_01: They did not miss it very massively at all in any of those years.
• 3:58
  SPEAKER_01: The cool part is the Stone X number is built of farmer surveys.
• 4:03
  SPEAKER_01: That's how theirs is comprised on that uh yield analyst guess.
• 4:07
  SPEAKER_01: The August WASDA is driven by farmer survey one, satellite imagery two.
• 4:14
  SPEAKER_01: So we just talked about Stone X.
• 4:16
  SPEAKER_01: They they did a farmer survey, came out at 188.1.
• 4:20
  SPEAKER_01: The other category that influences the August WASDAerport was vegetative health based on satellite imagery.
• 4:27
  SPEAKER_01: That's two.
• 4:28
  SPEAKER_01: That's a smaller weighted percentage, according to the man that puts all this together at the USDA, but if you look at it, that one's coming out at a 189.2.
• 4:39
  SPEAKER_01: So you have those two things making up that August WASDAerport, and those are two comparative numbers.
• 4:44
  SPEAKER_01: Completely different.
• 4:45
  SPEAKER_01: These will probably be 15,000 different people coming up with the farmer surveys, for example, so there's gonna be some give and take on that.
• 4:53
  SPEAKER_01: The USDA is also historically a little bit slower to adjust big yields, but nonetheless, the Stonex number is quite, I hate to say it is quite close normally to August yield expectations.
• 5:04
  SPEAKER_01: Um I would say uh generally speaking, if they if they were to come in two bushel high, you know, a 186 number, something along those lines, maybe that's what we could see out of this August WASDA.
• 5:16
  SPEAKER_01: Nonetheless, I based upon the August WASDA report, the way it's put together, I think you'll have a big yield in that August WASDA compared to what most people are thinking.
• 5:26
  SPEAKER_01: Um so I think they're probably gonna move a little bit more than what some people do or adjust just based on sometimes they're slower than they probably need to be, Jaden.
• 5:35
  SPEAKER_01: So I thought that's that stuff was very interesting based on you know what our yield was compared to Stonex, how Stonex yield is compared to history, and the standard deviation I'd argue is pretty tight compared to the August one at least.
• 5:48
  SPEAKER_01: So uh kind of interesting there.
• 5:51
  SPEAKER_01: Now let's talk about the USDA themselves, Jaden.
• 5:53
  SPEAKER_01: If you were to compare the July WASDA yield in bushels to the August WASDAY yield in bushels, how do they generally uh track between the two months that change?
• 6:04
  SPEAKER_00: So normally if they increase um their estimate from July and August, they're they normally bump at about 3.73 bushels in the last uh decade.
• 6:13
  SPEAKER_00: But if they decrease from July, they normally decrease by 2.5 bushels.
• 6:18
  SPEAKER_01: Yeah.
• 6:18
  SPEAKER_01: This year most people would say you're at a 181 trend line yield, you're uh probably going to increase that estimate.
• 6:28
  SPEAKER_01: Um the largest they increased in the last decade from that report was 2016.
• 6:33
  SPEAKER_01: They went from 168 to 175.
• 6:35
  SPEAKER_01: That was a seven bushel bump.
• 6:38
  SPEAKER_01: Other than that, it was like four, a lot of fours and threes that they bumped up.
• 6:42
  SPEAKER_01: So I would say if you bumped it four or five from that, you'd be right at that 185 to 186 number.
• 6:48
  SPEAKER_01: Kind of helps support that data as well, doesn't it?
• 6:51
  SPEAKER_00: Yes, it does, Mike.
• 6:52
  SPEAKER_00: Uh I was wondering your thoughts on what what bushel increase does it does a big shock in the market happen.
• 6:59
  SPEAKER_01: Anything uh is a a lot of questions have been raised.
• 7:03
  SPEAKER_01: You know, Arlen came out 188.1 is what they said, and look, the corn market's only down half a penny that day.
• 7:09
  SPEAKER_01: Um yeah, so they thought they they didn't care, and that that was the number they were already trading.
• 7:14
  SPEAKER_01: I would argue that the market has no care in the world about what Stonex posts or any other private analyst.
• 7:22
  SPEAKER_01: The market only trades the WASDA number and what the government posts.
• 7:26
  SPEAKER_01: That is the big dog, that's what they follow.
• 7:29
  SPEAKER_01: Um generally speaking, the market is trading something higher than 181 today.
• 7:34
  SPEAKER_01: We all know that the crop is big out there.
• 7:36
  SPEAKER_01: Um it just depends how big.
• 7:38
  SPEAKER_01: Uh the average trade estimate for the August WASD is 184.3.
• 7:43
  SPEAKER_01: So in theory, I believe if you come out at that, it's a neutral report.
• 7:46
  SPEAKER_01: If you come out bigger than 184.3, it's bearish, in my opinion.
• 7:50
  SPEAKER_01: So anything above, I would say anything above 185, especially 186, that'd be bearish.
• 7:57
  SPEAKER_01: I mean, in my opinion, the market is not trading that already.
• 8:00
  SPEAKER_01: I think if you post a 185 or 186, we probably try to go put in new lows on this corn market well below four bucks that we saw this la this week, actually.
• 8:10
  SPEAKER_01: So that'd be my opinion, I guess, Jaden.
• 8:12
  SPEAKER_01: What do you think about that?
• 8:14
  SPEAKER_00: Yeah, Mike, I I I couldn't agree with more with that.
• 8:16
  SPEAKER_00: I would just I would say to producers, I mean, listen in to the for these results and watch for some big market moving action.
• 8:23
  SPEAKER_01: For sure, for sure.
• 8:25
  SPEAKER_01: Um any other general thoughts about the crop tour, just condition-wise, how we came up with our numbers.
• 8:30
  SPEAKER_01: You know, we went each uh each podcast, we went through each state-by-state breakdown.
• 8:35
  SPEAKER_01: Um, generally speaking, the Western Corn Belt, Nebraska, South Dakota, Minnesota, Iowa, you know, that this Western Corn Belt looked fantastic overall.
• 8:45
  SPEAKER_01: I mean, all capable of somewhat close, if not all, record yields, in our opinion, from what we've seen.
• 8:51
  SPEAKER_01: A lot of year to go yet, we saw how big of a difference it makes with August and September last year when we dried down the crop really hard and we shrunk it from a 183 to a 179.
• 9:01
  SPEAKER_01: So we we know that and we see that in a lot to be played out.
• 9:04
  SPEAKER_01: Uh some of these recent rains in the Western Corn Belt, another inch there a day or two ago for a lot of our operations, you sitting in a pretty good spot.
• 9:12
  SPEAKER_01: As long as you don't get hailed out, wind, which we've seen a couple swaths now take a shot at last night, North Dakota to Minnesota, last Monday, yeah, you saw a big shot uh going across like um uh South Dakota and Iowa, basically.
• 9:28
  SPEAKER_01: But nonetheless, when I don't get me wrong, I would just argue that the Western Corn Belt has a potential to be better than records.
• 9:38
  SPEAKER_01: Eastern Cornbelts really gonna struggle to get there.
• 9:41
  SPEAKER_01: I think from the yields we pulled, the samples we pulled, um you weren't at a record.
• 9:46
  SPEAKER_01: You sure you could be close in some instances, but I just didn't think you get w east of western Illinois, and I I struggled to find good samples.
• 9:55
  SPEAKER_01: And to build this point back up a little bit, to get a 189, you're gonna need massive yields out of Illinois and Indiana, because it try to explain to us how much a state like Minnesota is worth for the average yield compared to someone like Illinois.
• 10:10
  SPEAKER_00: Yeah, so like we we have Minnesota at a 201, and if you were to knock that down 10 bushels, let's say to a 191, that only impacts the national yield by 10 bushels.
• 10:21
  SPEAKER_00: But like a state like Illinois, like we have them at a 207, but if you put them up at a 217, that that knocks the national yield up by 1.5 bushels.
• 10:30
  SPEAKER_01: What was the n the other national average yield on Minnesota if you dropped it 10 bushel?
• 10:35
  SPEAKER_01: What does that drop national yield?
• 10:36
  SPEAKER_00: Yeah, that drops the national yield by one bushel.
• 10:39
  SPEAKER_01: One bushel is all.
• 10:40
  SPEAKER_01: If you drop Minnesota 10.
• 10:42
  SPEAKER_01: Now, Illinois, if you bumped it up ten, how big of a bump is that?
• 10:46
  SPEAKER_00: Yeah, it's one point five bushels.
• 10:48
  SPEAKER_01: 1.5 bushels.
• 10:49
  SPEAKER_01: So it it it's close, and I know it's it's half a bushel difference, but you can just show that you know the change in Illinois is much weighted greater than than Minnesota, for an example.
• 11:00
  SPEAKER_01: So just wanted to put that into perspective as well, that to get those massive 188 yields, you're gonna need massive yields out of the eastern corn belt to get that 188, 189.
• 11:11
  SPEAKER_01: And we think they're gonna struggle to get there.
• 11:13
  SPEAKER_01: Maybe not in this August Wazday report, because they're not in the fields yet.
• 11:17
  SPEAKER_01: The August uh WASD does not have any field samples.
• 11:20
  SPEAKER_01: So when I go out and I I could say today, I think you probably could post a pretty big yield in this August WASDA and then pair it back from there, or at least the market will think so.
• 11:30
  SPEAKER_01: Um let's talk a little bit more about just seasonality of the crop.
• 11:35
  SPEAKER_01: So the average corn seasonal, if you go back the last five, ten, fifteen, twenty, thirty years, almost all end up at the end of Jul end of August that you put a low in this corn market.
• 11:46
  SPEAKER_01: Specifically bigger crop years, you like to put a low in before you get in the field and harvest it.
• 11:51
  SPEAKER_01: Very typical of a corn market.
• 11:53
  SPEAKER_01: This year we sure could be.
• 11:55
  SPEAKER_01: It looks like we're trying to get below four bucks again.
• 11:57
  SPEAKER_01: Very similar chart pattern to what last year was when we put a low in at the end of August, August 26th, that 386 D's futures.
• 12:05
  SPEAKER_01: This year, it's following a very similar trading pattern.
• 12:08
  SPEAKER_01: I I could see something similar happening, at least we'll see what happens the rest of the month here.
• 12:14
  SPEAKER_01: But um from a seasonal perspective, this is playing out like a very normal corn crop probably wouldn't, in my opinion, from that example.
• 12:22
  SPEAKER_01: The other thing worth mentioning is funds.
• 12:24
  SPEAKER_01: Fund activities.
• 12:25
  SPEAKER_01: Right now, uh you were at 150,000 in the last CFTC report, but it looks like you're probably just short of 200,000 contracts of managed money short positions.
• 12:35
  SPEAKER_01: So you could maybe build on that a little bit more.
• 12:38
  SPEAKER_01: You know, you put a record in around July last year.
• 12:42
  SPEAKER_01: Um I would argue you maybe got another 50 to 100,000 contracts short here, you could put on that guy, and then you typically like to rally up.
• 12:51
  SPEAKER_01: Last year, I think you spent a total of 30 days below four bucks was all.
• 12:56
  SPEAKER_01: Um, historically speaking, uh, just as of the last five more ten years, you know, we don't like spend a ton of time below four bucks on these years we've spent above it if we don't have to.
• 13:05
  SPEAKER_01: So something else worth mentioning that, you know, if we do go put a new low in, hopefully it's a it's a quick one at least, Jaden.
• 13:13
  SPEAKER_01: Any other final thoughts about what to talk about with our final crop tour?
• 13:17
  SPEAKER_00: Yeah, Mike, I just encourage everyone to log into our website and register for a webinar on Monday.
• 13:23
  SPEAKER_00: It's at 8 a.m.
• 13:24
  SPEAKER_00: and we'll we'll dive deeper into uh our crop tour results and and you can ask questions if you if you please do so.
• 13:31
  SPEAKER_01: Yeah, it's kind of a a number uh uh drop on you here.
• 13:35
  SPEAKER_01: I mean, we just flooded you today with a bunch of numbers on a podcast, so on uh Mondays it'll be better just to see visually what those look like on patent paper.
• 13:44
  SPEAKER_01: So uh thank you for joining us.
• 13:47
  SPEAKER_01: Thank you for following us on the crop tour.
• 13:49
  SPEAKER_01: This podcast is also brought to you by Pro Ag Power Grains, the all in one grain marketing tool tied directly to your brokerage account.
• 13:56
  SPEAKER_01: Track cash, futures, and options all in one place, compare your cost of production with others, use what if tools to build your marketing plan, and get to work with uh wonderful people at professional ag marketing on developing the right risk management strategy for your operation.