Analysts reduce corn estimates, move closer to Genscape forecast

By Genscape | September 04, 2013

Over the past week many corn crop analysts have significantly reduced their 2013 corn supply predictions to be more in line with the much lower corn crop harvest predicted by Genscape on its Aug. 8 press release. One well known industry group reduced its estimate from significantly above USDA’s value of 13.8 billion bushels to significantly below that benchmark number.

There were several fundamental signals that drove LandViewer to take a more moderate view towards the 2013 expected supply and Genscape made it clear that it never supported the high USDA planted acreage number released in June of 97.4 million acres.

LandViewer combines extensive ground truth with high resolution satellite imagery to give its clients detailed acreage loss by county in the areas hit the hardest by spring floods in northern Iowa, southern Minnesota and east central Illinois. There were numerous drowned out fields which Genscape took into consideration while many industry analysts overlooked the situation. Additionally, LandViewer never supported the high USDA yield number released on August 12 of 14 billion bushels, even with a well-known analyst predicting 14.3 billion bushels.

Analysis and commentary on this topic is beginning to emerge across the industry. In an article last week from Bloomberg, “Expanding U.S. Drought, Excessive Heat Hurt Iowa Corn, Soy Crops,” reporter Jeff Wilson discusses the expanding U.S. drought and how excessive heat is damaging crops. “Cool weather during the first 19 days of August masked the stress that the dry spell was causing to crops over most of the Midwest, Planalytics Inc. said in a report Thursday. The epicenter of the crop damage is in Iowa, based on the vegetative growth index that the forecaster constructs biweekly from satellite images.”

LandViewer constructs a daily vegetation index from NASA satellite data rather than a biweekly value so it is able to identify the epicenter of the crop damage earlier than others. Genscape uses highly trained soil experts rather than crop scouts for their field inspections which provides for a much more forward looking ground truth operation.  Additionally, LandViewer constructs a highly mathematical model for their yield prediction with a regression approach that is more processing intensive, but includes logic that allows analysts to correct the model for ground truthing observations.

“It is not that we wanted to go against the grain in our predictions because we all like record harvests and ample corn supplies. But keep in mind that despite the recent problems, the 2013 harvest will be very solid and certainly above the five year average with advanced hybrids still producing yields in adverse conditions,” states Steffen Mueller, senior director of Genscape’s LandViewer group.

 

 

One well known industry group reduced its estimate from significantly above USDA’s value of 13.8 billion bushels to significantly below that benchmark number.

There were several fundamental signals that drove LandViewer to take a more moderate view towards the 2013 expected supply and Genscape made it clear that it never supported the high USDA planted acreage number released in June of 97.4 million acres.

LandViewer combines extensive ground truth with high resolution satellite imagery to give its clients detailed acreage loss by county in the areas hit the hardest by spring floods in northern Iowa, southern Minnesota and east central Illinois. There were numerous drowned out fields which Genscape took into consideration while many industry analysts overlooked the situation. Additionally, LandViewer never supported the high USDA yield number released on August 12 of 14 billion bushels, even with a well-known analyst predicting 14.3 billion bushels.

Analysis and commentary on this topic is beginning to emerge across the industry. In an article last week from Bloomberg, “Expanding U.S. Drought, Excessive Heat Hurt Iowa Corn, Soy Crops,” reporter Jeff Wilson discusses the expanding U.S. drought and how excessive heat is damaging crops. “Cool weather during the first 19 days of August masked the stress that the dry spell was causing to crops over most of the Midwest, Planalytics Inc. said in a report Thursday. The epicenter of the crop damage is in Iowa, based on the vegetative growth index that the forecaster constructs biweekly from satellite images.”

LandViewer constructs a daily vegetation index from NASA satellite data rather than a biweekly value so it is able to identify the epicenter of the crop damage earlier than others. Genscape uses highly trained soil experts rather than crop scouts for their field inspections which provides for a much more forward looking ground truth operation.  Additionally, LandViewer constructs a highly mathematical model for their yield prediction with a regression approach that is more processing intensive, but includes logic that allows analysts to correct the model for ground truthing observations.

“It is not that we wanted to go against the grain in our predictions because we all like record harvests and ample corn supplies. But keep in mind that despite the recent problems, the 2013 harvest will be very solid and certainly above the five year average with advanced hybrids still producing yields in adverse conditions,” states Steffen Mueller, senior director of Genscape’s LandViewer group.