By Suzanne Cosgrove
CHICAGO (Reuters) - Incessant rains have turned Indiana farmer Larry Winger's grain fields into ponds, making it impossible for him to seed his corn crop.
"Historically, we would like the work to be done by the first of May, and research shows the optimal planting time is the last week of April," said Winger, who plants half of his 2,500 acres with corn, and the other half with soybeans.
"Prospects are OK until May 10, but after May 10, we start losing bushels," he added.
Similar scenes of waterlogged fields stretch from Minnesota to Indiana to Nebraska, the heart of the U.S. Corn Belt. Unusually wet conditions are keeping farmers out of their fields during the crucial spring planting season.
Delays in seeding pushed new-crop December corn futures at the Chicago Board of Trade about 7 percent higher in the past month, with prices climbing on fears that planting delays will reduce this year's crop at a time when corn stocks are at their tightest in 80 years.
Just 9 percent of the U.S. corn crop, the world's largest, was planted as of Sunday, compared with the five-year average of 23 percent and last year's record pace of 46 percent.
That data heightened concerns that farmers in many states would miss the deadline for seeding and end up with poor yields -- keeping stocks low next year and raising the need to curb demand from ethanol makers and livestock feeders.
Tight corn stocks and the subsequent price rally have been instrumental in the rise of food inflation in countries like China, which resumed importing corn in large quantities from the United States last year.
Analysts are closely watching planting progress in rain-soaked North and South Dakota and Minnesota -- forecast by the U.S. Department of Agriculture to plant an extra 1.5 million acres of corn this year over 2011, which accounts for 38 percent of the expected national increase.
Grains analyst Rich Feltes of R.J. O'Brien said the odds of below-average corn yields increase to 50 percent with late planting. Across all other years, the odds of below-trend corn yields are only 25 percent, he said.
He said even a one bushel-per-acre cut in the U.S. Agriculture Department's February yield forecast would push corn stocks next summer to an "intolerably tight" 514 million bushels and a record low stocks-to-use ratio of 3.8 percent.
SWITCH TO SOYBEANS AN OPTION IF POOR WEATHER CONTINUES
Some analysts speculate that further delays in seeding the corn crop could lead some farmers to switch to soybeans.
But the price ratio between corn and soybeans still favors the planting of corn over soybeans, analysts said.
The new-crop corn/soybean price ratio usually is 2.5 to 1, which means it takes 2 1/2 bushels of corn to equal 1 of soybeans, said Karl Setzer, a commodity trading advisor at MaxYield Cooperative in Algona, Iowa.
Currently that ratio is about 2 to 1, he said.
The Department of Crop Sciences at the University of Illinois at Urbana-Champaign said that based on a model it had developed, planting corn remained more profitable in April and will continue to be so into late May. But beyond May 27, seeding soybeans will become more profitable than corn.
Using prices gathered from grain elevators and other delivery points, the university estimated corn profitability in Illinois was $274 per acre over soybeans as of April 1, but peters out to $182 by April 29 and turns negative by May 27 at minus $31 -- making it more profitable to plant soybeans at that stage.
Bob Nielsen, a Purdue University extension agronomist in West Lafayette, Indiana, said the optimal planting period in his area is between April 20 and May 10. After that, yield potential drops by one to two bushels a day, he said.
However, Nielsen was quick to add that a late planting date does not necessarily mean lower yields in a given year. Final yields also depend on conditions after planting -- weather, disease and insects.
An even slower planting start in 2009, with just 5 percent of the U.S. corn planted at around this time of the year, did eventually produce a record crop of 13.2 billion bushels.
Winger is guardedly optimistic he will be able to plant his crop in the next two weeks without any loss in yields. If he and many other farmers are able to pull it off, the risk premiums built into December corn futures could wither.
December corn futures fell on Thursday 4.5 percent on outlooks for drier weather in parts of the Corn Belt next week.
Grains analyst Dan Basse of AgResource Co in Chicago said about 30 cents, or about 4.5 percent, of risk premium was built into the December contract. But he added that "history was against this year's crop" because of late planting. He does not expect December futures to slip below the $6.00-$6.40 range.
Winger said he still has time to seed his crop, although he is nervous. "If you call me back in 10 days," and if the corn still is not planted, "my nervousness will go up," he said.
(Reporting by Suzanne Cosgrove; Editing by David Gregorio)