Corn Harvest Off to a Record Start

The U.S. corn harvest, the world's largest, got off to the fastest-ever start last week as early planting last spring and a hot summer accelerated crop development, a U.S. government report showed on Monday.

Four percent of the crop, which has been devastated by the worst drought in half a century, was harvested as of Sunday, according to the U.S. Department of Agriculture's weekly crop progress report. The report was released after Monday's grain markets, which were sharply higher, had closed.

The harvest estimate was the first of the year and earliest on record. It beat the previous record, set most recently in 2010, by two weeks.

A year ago, corn harvest was 1 percent complete. The five-year average for late August is also 1 percent but the USDA has never given a harvest update during August until this year.

The report showed the corn harvest was largely underway in the southern states but also in the Midwest, which has been hardest hit by the drought. The hot, dry weather sent crop prices to record highs in the world's largest grain exporter.

In Illinois, the second largest state for corn production, harvest was 3 percent complete. Harvest in Iowa, typically the top corn producer, had not yet started, according to the USDA report.

Southern states such as Texas and Tennessee set the pace in harvest progress but the report also showed that cutting had begun in key production areas such as Illinois, Nebraska and Kansas.

"Corn harvest has begun in earnest this week," Tim Campbell, a county agent for the USDA's National Agricultural Statistics Service in Dyer County, Tennessee, said in a report. "Earliest I can remember since working in Dyer County beginning in 1992."

In Texas, corn harvest was 50 percent complete but progress advanced just 1 percentage point due to stormy conditions. Portions of northeast Texas received more than four inches of rain.

USDA also said that the corn crop was rated 23 percent good to excellent, unchanged from a week ago and in line with market expectations for the drought-stricken crop.

Crop conditions have stabilized during the past two weeks after free falling throughout the summer due to the drought but the crop still had the worst ratings since 1988.

USDA said that 51 percent of the corn was rated poor to very poor, unchanged from a week earlier.

Soybeans were rated 31 percent good to excellent, up 1 percent from a week earlier due to spotty rainfall in some areas east of the Mississippi River. The ratings, which have improved for two weeks in a row after six weeks of declines, matched expectations in a Reuters survey of 13 analysts.

Soybeans rated poor to very poor improved to 37 percent from 38 percent a week ago.

Poor-to-very poor ratings for both crops are worse this summer than they were in 1988.

Cooler and mostly dry weather is expected this week in the U.S. Midwest crop belt with the exception of light rain late in the week in the northwest. Showers were forecast for the southwest Plains Monday and Tuesday, MDA EarthSat Don Keeney said on Monday.

Most crops were too far along to benefit from the improving weather but some farmers that got a late start could see a slight boost to yield potential.

"Not that it is going to make a big difference in most of the areas (but the rain) it will be beneficial to some late developing fields," said Shawn McCambridge, grains analyst with Jefferies Bache.