Des Moines, Iowa—U.S. corn yields will become increasingly volatile from year to year, according to Elwynn Taylor, Iowa State University professor of agricultural meteorology. Taylor made the comment during a seminar at the World Pork Expo in Des Moines Thursday.
While the price of corn has been higher than production cost for the past several years, this likely will not persist, according to Taylor.
“We are due to head into a period of volatility in yield beginning in 2012 or 2013,” he said. “Risk management on corn yields will be increasingly important.”
La Nina began in 2010, it peaked in 2011 and it looks like it ended in April 2012, but we don’t know if it is gone, according to Taylor. “These strong ones have a bad habit of coming back. July 10 will be a key date as weather trends will be sufficiently developed to make a more accurate assessment on whether corn yield will attain trend levels.”
Taylor says trend line yield for corn currently is at 161 bushels per acre and sets the chance of that occurring at 29 percent. However, if the yield is the same as seen in 2011, 147 bushels per acre, Taylor expects to see a price of $6.70 per bushel. “At a yield of 160 bushels per acre, he expects to see a price of $4.85.
Although the U.S. is overdue to experience a major drought, Taylor maintains a favorable outlook. The risk of drought this summer is reduced somewhat, he says, due to in presence of wet weather so far in 2012 in South Carolina. “Of the past 17 U.S. droughts, 16 started in South Carolina, giving that state a unique predictive quality.”
To stay informed on agriculture weather risks, Taylor recommends a Website that is constantly updated and gives details by state. Click on the Ag Weather button.