U.S. and South America Grain and Oilseed Weather Considerations for 2013

Mike TannuraMeteorologist, Agricultural Economist, and Owner

Transportation, Elevator, and Grain Merchants AssociationJanuary 24, 2013

Source: National Weather Service

U.S. Drought MonitorAs of Tuesday, January 15

Source: United States Geological Survey

U.S. StreamflowMonday, January 21, 2013

Source: United States Geological Survey

Upper-Mississippi StreamflowMonday, January 21, 2013

Source: United States Geological Survey

Missouri StreamflowMonday, January 21, 2013

Source: National Weather Service

• A tale of two grain belts – one very dry, one wet

PrecipitationPercent of Normal, 180-Day Period Ending Monday

U.S. Winter Wheat Production2007 - 2011 Average

Precipitation (Percent of Normal)Weighted By U.S. Crop Production

180-Day Period Ending Monday

• 68% of HRW wheat in drought, compared to only 10% of SRW wheat

Soil Moisture:Extreme Drought

Drought Normal WetExtreme Wetness

Precipitation (Percent of Average):

(0% - 50%) (50% - 75%) (75% - 125%) (125% - 200%) (200% +)

CORN 20% 36% 40% 4% 0%

SOYBEANS 15% 32% 47% 6% 0%

HRW WHEAT 27% 41% 29% 3% 0%

SRW WHEAT 0% 10% 77% 12% 0%

SPRING WHEAT 16% 36% 44% 4% 0%

Neutral Conditions Exist(Neither El Niño nor La Niña)

Neutral Conditions To ContinueThrough Summer

Data source: Climate Prediction Center

U.S. Temperature ProbabilityMarch-April-May

U.S. Precipitation ProbabilityMarch-April-May

10 Driest May-December PeriodsIn Kansas-Nebraska-Oklahoma

1895 - 2012

Data source: National Climatic Data Center

March-April Precipitation After The 10 Driest May-December PeriodsIn Kansas-Nebraska-Oklahoma

Data source: National Climatic Data Center

U.S. Winter Wheat Yield1950 - 2012

Data source: National Agricultural Statistics Service

U.S. Winter Wheat Yield After The 10 Driest May-December PeriodsIn Kansas-Nebraska-Oklahoma

Data source: National Agricultural Statistics Service

U.S. Corn Production2007 - 2011 Average

U.S. Soybean Production2007 - 2011 Average

Ideal Weather ForHighest U.S. Corn Yield

Ideal Weather ForHighest U.S. Soybean Yield

U.S. Corn Yield1960 - 2012

Data source: National Agricultural Statistics Service

U.S. Corn Yield(Departure From Trend)

1960 - 2012

Data source: National Agricultural Statistics Service

U.S. Corn Yield and Lagged September-March Precipitation*

1960 - 2012

* Precipitation in Illinois-Indiana-Iowa Data source: National Agricultural Statistics Service

U.S. Soybean Yield and Lagged September-March Precipitation*

1960 - 2012

* Precipitation in Illinois-Indiana-Iowa Data source: National Agricultural Statistics Service

Summary

• A large-scale and intense drought is in progress

• May-December ranked #1 driest in at least 118 years across the key winter wheat states of Kansas-Nebraska-Oklahoma

• Moderate historical support for slightly dry weather and low wheat yields during the key March-April period

• The drought neither increases nor decreases the odds for above-trend or below-trend U.S. corn and soybean yields in 2013

• Autumn and winter weather hold no predictive value for future U.S. corn and soybean yields

U.S. Earthquakes

• Do you live in the Midwest or Mississippi Delta?• Have you ever felt an earthquake?

San Francisco Earthquake

• Magnitude 7.9 on April 18, 1906

U.S. Earthquake Risk

• The risk of a major earthquake in the central U.S. “is as high as for places in California” – United States Geological Survey, 2007

Source: United States Geological Survey

Two Seismic Zones InThe Corn Belt and Delta

Halloween EarthquakeNear Cairo, Illinois

• Magnitude 6.8 on October 31, 1895

Source: United States Geological Survey

New Madrid Earthquake SequenceDecember 1811 – February 1812

• 4 earthquakes of Magnitude 7.8 – 8.1 • 8 earthquakes of at least Magnitude 7.0 (not aftershocks)• “…weeks to months…” of disruption would affect agriculture and its

transportation infrastructure if a sequence recurred today – USGS 2009

South AmericaGrains and Oilseeds

Argentina PrecipitationLast 90 Days (Ending Monday)

Argentina PrecipitationLast 30 Days (Ending Monday)

Argentina’s Recent Weather Pattern

Summary

• Argentina is drying and its corn and soybeans need rain to return

• Key corn and soybean areas of Center-West / Southeast Brazil and Bahia have been drier than average throughout most of its growing season

Summary

• A large-scale and intense drought is in progress

• May-December ranked #1 driest in at least 118 years across the key winter wheat states of Kansas-Nebraska-Oklahoma

• Moderate historical support for slightly dry weather and low wheat yields during the key March-April period

• The drought neither increases nor decreases the odds for above-trend or below-trend U.S. corn and soybean yields in 2013

• Autumn and winter weather hold no predictive value for future U.S. corn and soybean yields

• Argentina is drying and its corn and soybeans need rain to return

• Key corn and soybean areas of Center-West / Southeast Brazil and Bahia have been drier than average throughout most of its growing season

Thank You!Questions?

Mike Tannura Meteorologist, Agricultural Economist, and Owner Email: mike@tstorm.net Website: www.tstorm.net Phone: (312) 638-0993 Toll Free Phone: (866) 475-7370

980 North Michigan AvenueSuite 1400Chicago, IL 60611