The state of the U.S. crops has made a sudden change in recent weeks.
For much of the growing season, the U.S. corn and soybean crops were highly rated and some of the best seen in recent history. While still higher than normal, we have seen the top end of the ratings decrease as hot, dry weather has impacted both crops.
Reports of sudden death syndrome have also been reported in U.S. soybean fields to further reduce yield expectations.
The question now is how much production may have been lost. A better indication of this will likely come in the September supply and demand report, which is the first of the year to contain field collected data.
The question that comes with these crop declines is what they mean for balance sheets. The U.S. Department of Agriculture (USDA) is predicting record production this coming year, but also sizable increases in commodity demand. It isn't out of the question that demand may be overstated at the present time,...