Acreage Reduced, But Yields Offset (10/10/14)
Chad Hart, ISU Extension Grain Marketing Economist, provides a summary of the latest USDA report.
Over the past couple of months, there had been significant discussion of crop acreage numbers and whether the NASS estimates would be adjusted downward. That adjustment occurred in the most recent reports. For corn, planted and harvested area were reduced by 700,000 acres. A similar downward adjustment took place for soybeans. But in both cases, the acreage losses were offset by higher yields so that total production continued to climb. The national average corn yield was raised 2.5 bushels to 174.2 bushels per acre. The corn yield estimates were raised in 22 states. And 22 states are projected to set state records as well. Illinois is projected at 200 bushels per acre. The jump in soybean yields isn’t quite as dramatic, but the end result is the same, larger production. The national average is projected at 47.1 bushels per acre, up 0.5 bushels. 13 states are expected to have record yields.
Putting it all together, USDA estimates a 14.475 billion bushel corn crop and a 3.927 billion bushel soybean crop. Both, by far, the largest crops the country has ever produced. In comparison, the demand projections were little changed. Corn feed and residual use was increased by 50 million bushels. That was the only shift in projected demand for the 2014 crops. Estimates for the 2014/15 market year average prices dropped 10 cents for corn to a midpoint of $3.40 per bushel. For soybeans, the price estimates held steady, with a midpoint of $10 per bushel.
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