Agricultural News
USDA Predicts Big U.S. Corn and Soybean Crops, Leaving Traders Surprised
Wed, 12 Aug 2015 16:18:27 CDT
A slow start to the planting season in the Midwest doesn't look to impact the nation's crop production. U.S. corn and soybean production came in higher than trade estimates when the U.S. Department of Agriculture released its latest crop production estimate on Wednesday, August 12th. If realized, USDA is forecasting corn production to be the third highest on record and the second largest U.S. soybean production on record. In comparison to the nearly perfect growing season for much of cornbelt last year, USDA estimates corn production to be down four percent and soybean production to be down one percent from last year. The winter wheat production estimate was lowered by one percent from the July forecast. Nationally, sorghum production is forecast to be up 32 percent from last year, while cotton production is forecast to be down 20 percent.
On Wednesday, the news turned grain prices sharply lower. Justin Lewis of KIS Futures said the report offered several big surprises. Trade estimates predicted the average corn yield would drop to 164.5 bushels an acre and USDA came out with 168.8 bpa. Lewis said that was four bushels an acre above the trade estimate and bigger than highest estimate. A similar scenario took place for soybeans, as USDA increased soybean production to 46.9 bpa. Lewis said that was higher than the average trade guess of 44.7 bpa.
"That was an extremely big surprise," Lewis said. "-Everybody was looking for a decrease and the fact that it was increased, was a big surprise."
Corn production is forecast at 13.7 billion bushels, down 4 percent from last year's record production. Based on conditions as of August 1, yields are expected to average 168.8 bushels per acre, down 2.2 bushels from 2014. If realized, this will be the second highest yield and third largest production on record for the United States. Area harvested for grain is forecast at 81.1 million acres, unchanged from the June forecast but down 2 percent from 2014.
Soybean production is forecast at 3.92 billion bushels, down 1 percent from last year. Based on August 1 conditions, yields are expected to average 46.9 bushels per acre, down 0.9 bushel from last year. Area for harvest in the United States is forecast at a record 83.5 million acres, down 1 percent from June but up nearly 1 percent from 2014. Planted area for the nation is estimated at 84.3 million acres, down 1 percent from June.
All wheat production, at 2.14 billion bushels, is down slightly from the July forecast but up 5 percent from 2014. Based on August 1 conditions, the United States yield is forecast at 44.1 bushels per acre, down 0.2 bushel from last month but up 0.4 bushel from last year.
Winter wheat production is forecast at 1.44 billion bushels, down 1 percent from the July 1 forecast but up 4 percent from 2014. Based on August 1 conditions, the United States yield is forecast at 43.2 bushels per acre, down 0.5 bushel from last month but up 0.6 bushel from last year. The area expected to be harvested for grain or seed totals 33.3 million acres, unchanged from last month but up 3 percent from last year. Hard Red Winter production, at 856 million bushels, is down 1 percent from last month. Soft Red Winter, at 389 million bushels, is down 1 percent from the July forecast. White Winter, at 193 million bushels, is down 1 percent from last month. Of the White Winter production, 12.5 million bushels are Hard White and 181 million bushels are Soft White.
Sorghum production is forecast at 573 million bushels, up 32 percent from last year. If realized, this will represent the highest production total in the United States since 1999. Area harvested for grain is forecast at 7.67 million acres, down 1 percent from June but 20 percent more than was harvested in 2014. Based on August 1 conditions, yield is forecast at a record 74.6 bushels per acre, 7 bushels above the 2014 average and 1.4 bushels higher than the previous record yield set in 2007. Record high yields are expected in Arkansas, Illinois, and Mississippi. Planted area for the Nation is estimated at 8.74 million acres, down 1 percent from June.
All cotton production is forecast at 13.1 million 480-pound bales, down 20 percent from last year. Yield is expected to average 795 pounds per harvested acre, down 43 pounds from last year. Upland cotton production is forecast at 12.7 million 480-pound bales, down 20 percent from 2014. Pima cotton production is forecast at 432,000 bales, down 24 percent from last year. All cotton planted area for the Nation is estimated at 8.90 million acres, down 1 percent or 100,000 acres from June.
Higher projected yields increases overall production and in turn ending stocks. Lewis said that lead to some surprises in the projected 2015-2016 ending stocks. Lewis said the higher production sent futures price prices sharply lower Wednesday. He said it will take another day or two for the effects of this report to move through, then traders will shift their focus to next month's crop production report and the weather.
Click here to read the full USDA Crop Production report.
Click here for the full World Agricultural Supply and Demand Estimates
WebReadyTM Powered by WireReady® NSI
Top Agricultural News
More Headlines...
