Recent weather conditions including widespread drought, high night-time temperatures and localized rains have created a difficult environment for buyers of regionally grown feed ingredients and byproducts.
Yet, satellite imagery algorithms, originally developed by the University of Illinois at Chicago to refute overstated land use change claims set forth by many academics and regulators against expanded agricultural production, now can be used in a novel way to protect corn supply chains for grain buyers.
Grain buyers long have watched and even relied on U.S. Department of Agriculture reports generated throughout the growing season, including the weekly crop progress reports, the preliminary acreage report (usually released end of June) and the USDA crop report (usually releases second week of August).
While these reports provide helpful benchmarks, they themselves influence market price movements and that means by the time the reports are released it can be challenging to adjust risk management strategies, according to Dr. Steffen Mueller, principal research economist at the university.
Also, the spatial resolution of the reports focuses on the larger inter-regional level whereas grain buyers can benefit from county and even sub-county level data, Mueller said.
Since USDA relies heavily on farmer survey data (combined with some satellite imagery analysis) county level acreage and yield data is only released in the spring following the growing season of interest.
Also, the fixed release schedule for some of the key reports set by USDA months in advance may render some of the information less meaningful. For example, Mueller said, in an early planting year like this year releasing preliminary yield estimates close to mid-August trails the emerging knowledge in the fields.
The research products developed by Mueller and his research collaborator Ken openhaver have shown that satellite imagery can fill the spatial and temporal information void and provide useful and reliable information for livestock producers and commercial feed companies.
Reliable in-season, sub-regional data allows facilities to determine early the proper supply radius and those clusters of growers or grain elevators that are affected by above or below average yields, Mueller said.
The system of satellite and weather routines, termed LandViewer, allows a very localized view of a grain buyer’s corn supply area.
It calls on proprietary software algorithms to rapidly process new satellite imagery and weather station data for comparison with databases of vegetation, climate and planting history.
Copenhaver, who has been leading the satellite development efforts, explains tht three types of satellite imagery at different resolutions are used to calibrate the yield and acreage models.
Additional ground verification (“ground-truthing”) is performed during scouting trips in early June by cataloguing the coordinates of corn fields for input to the satellite acreage model and in late July during scouting trips by agronomists for input to the yield model.
The highest resolution satellite data is also used to work closely with key growers delivering to the plants.
Then, in a series of meetings with the grain buyers the LandViewer team provides several information products, including near infrared field conditions, vegetation vigor in corn draw area, yield estimates and localized weather conditions.
The meetings with grain buyers are strategically scheduled throughout the growing season to optimize the plants’ risk management strategies...
Source: Argentine Beef Packers S.A.
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