Washington, July 15 - Farmers have always watched the sky to glean what the weather will bring to their fields, but U.S. officials and some private companies have been getting even better crop forecasts by looking up to the heavens.
The U.S. Agriculture Department, regarded as the definitive source of global crop information, is growing more dependent on satellite data to complement its age-old information gathering methods of interviews, surveys, field visits and crop experts.
Three orbiting satellites help the USDA's National Agricultural Statistics Service (NASS) calculate estimates for 25 states, including all the major corn, wheat, rice, cotton and soybean producers. More states could soon be on the way.
It's a far cry from a few years ago when data was collected and processed for just "a handful of states," said Rick Mueller, head of the group that gathers satellite information for NASS.
"What we are trying to do each year is expand our remote sensing program's coverage and improve our timeliness," said Mueller.
"If we can reduce the variance on survey results and provide accurate estimates ... then that's great. It gives us more confidence in our results," he added.
USDA has been using satellites since the 1970s to help validate year-end acreage summaries and contribute to county estimates compiled during the winter.
But timelier, in-season information from satellites can now be used to help calculate crop area and production figures. On average, USDA receives updated information from the same area every five days, except where clouds obscure the data-collecting process.
Satellites "provide a very good tool for these decision makers," said Mueller. "The results that we are coming up with are pretty close to the actual numbers," he said.
USDA's NASS first started using satellites to help it compile acreage estimates for the October 2007 crop report. Since then, it has used the technology for the August and October reports in 2008 and plans to do the same two months this year.
It further expanded its reach, after months of experimenting, to include winter wheat estimates for the first time in the annual acreage report issued this past June.
'ONLY TIME WILL TELL'
Lanworth Inc., an Illinois-based data analysis firm, has relied heavily on satellite imagery to estimate production figures sooner and with fewer resources.
While it still uses weather maps and precisely targeted field sampling, satellites have helped it produce data whose accuracy has won the attention of grain traders and companies.
In June, for example, Lanworth predicted a spring wheat crop of 13.6 million acres, well above the average trade estimate of 13.31 million, and just under USDA's 13.77 million acre forecast. It also projected corn to exceed 85 million acres, at the high end of estimates, but short of USDA's surprising 87 million acre forecast.
The company had only a few clients when it issued its inaugural crop forecast in October 2007, but now it has nearly 100, including hedge fund traders and Fortune 500 food companies looking to lock in commodity prices.
"I couldn't see getting accurate estimates without" satellites, said David Levine, Lanworth's vice president of business development. "You would just have to send too many people to too many places and that would just be unwieldy, time consuming, expensive and it wouldn't be real time."
The data does not come cheap. A subscription can run upward of $100,000 for larger companies each year, a figure even Levine admitted was "pricey."
Chad Hart, an economist with the Center for Agricultural and Rural Development at Iowa State University, said satellites help make estimates more reliable.
"It adds another tool. How effective it is depends on how well they are able to mesh their survey data to get a more consistent projection. Only time will tell on that."