''Welcome to the Weather Market of 1991 3/8''
PAUL A. DRISCOLL
Mar. 30, 1991
Undated (AP) _ With planting season just down the road in the vast corn and soybean areas of the Midwest, the focus turns to the weather. This year in particular.
Considering the acreage going into these crops and the stocks on hand from previous years, farm experts say there isn't much room for setbacks during the planting and growing seasons.
''There will be a very serious need for normal or above normal yields to maintain the stocks we have,'' said William Biedermann, research director of Allendale Inc., a futures brokerage firm in Crystal Lake, Ill.
This was underscored Thursday when the U.S. Agriculture Department released its survey of planting intentions gathered from 75,000 farmers.
They say they'll allocate 1 percent fewer acres to soybeans and 3 percent more acres to corn than a year ago. But for both crops, the projections were below the USDA's forecast on Feb. 11 and below what the futures markets had been expecting.
While farmers could end up planting more than what they're saying now - and some agriculture specialists are expecting just that - the USDA's report went a long way toward eliminating one of the major question marks in this year's crop equation.
Now, growers, marketers and the rest of the farming industry shift their gaze to the skies.
''Welcome to the weather markets of 1991,'' said Richard Feltes, research director of Refco Inc. in Chicago.
Actually, weather already has been a factor in the winter wheat trade because of dry conditions in the Southern and Central Plains. This hard red winter wheat area has received only 72 percent of its normal rainfall since the first of the year. Recent wind storms have added to the problem by scouring the emerging crop with blowing sand and dirt.
The weather in the next four weeks will be critical in determining the quality of the wheat crop.
''My feeling is that we're going to see a less than ideal wheat crop,'' said Pete Leavitt, executive vice president of Weather Services Corp., a Bedford, Mass., private forecasting company and one of the largest serving the commodities trade.
It will be Leavitt and meteorologists at a dozen or so other private forecasters who will be supplying the agriculture industry with the specific weather data that goes beyond that provided by the National Weather Service.
What's known at this point for corn and soybeans is that there is ample moisture in the ground to get the crops going, too much in some areas.
But what about the coming weeks when farmers in the Midwest will be wanting to do pre-planting field work? How much rain will they get? Will it be too wet to get their tractors into the fields? Will planting be delayed? What's the growing season going to be like?
''The problem with long-range forecasts like this is that they're terrible,'' said Leavitt.
Forecasts this far into the future are based not on weather elsewhere on the globe that's heading this way.
Instead, they're derived from a study of weather patterns.
Forecasters look at weather of recent days and see if they can find analogous patters over the past 70 or 80 years. If there are good analogies, do they point toward some common weather patterns that develop subsequently?
For this season, Leavitt said, there are few good analogies and those that do exist point in different directions.
''A lot of things can happen before May 1,'' when serious planting gets underway,'' he said. ''My guess is that the wet patterns will persist. And then a lot of old timers say a wet spring leads to a dry summer. This is true a little more than half the time.''
But, he said, looking even seven to 10 days into the future ''is like peering into the fog.''
Here are some weekly commodity price trends:
Grain and soybean futures prices were mixed on the Chicago Board of Trade.
Wheat for delivery in May settled Thursday at $2.86 3/4 a bushel, compared with $2.83 a week earlier; May corn declined to $2.52 3/4 a bushel from $2.53 3/4 ; May oats advanced to $1.26 a bushel from $1.23 1/2 ; and May soybeans retreated to $5.74 3/4 a bushel from $5.75 1/2 .
Livestock futures were lower while pork bellies advanced at the Chicago Mercantile Exchange.
Live cattle for delivery in April settled at 81.40 cents a pound, compared with 81.57 cents; March feeder cattle slipped to 89.87 cents a pound from 90.05 cents; April hogs moved to 53.12 cents a pound from 53.27 cents; and May pork bellies advanced to 67.80 cents a pound from 67.42 cents.
Precious metals were lower on the Commodity Exchange in New York.
Gold for delivery in April settled at $357.10 a troy ounce, compared with $363.50; and May silver retreated to $3.868 a troy ounce from $3.993.
Energy futures were mixed on the New York Mercantile Exchange.
Light sweet crude oil for delivery in May settled at $19.63 a barrel, compared with $20.10; April heating oil declined to 56.89 cents a gallon from 58.25 cents; unleaded gasoline settled at 71.17 cents a gallon, compared with 71.18 cents; and May natural gas advanced to $1.405 per 1,000 cubic feet from $1.385.
End Adv March 30-31