Could Corn Yield Come Back Down?

August 17, 2016 05:00 AM
Could Corn Yield Come Back Down?

When you’re talking about the prospect of a bin-busting corn yield of 175.1 bpa this fall, as USDA forecast on Friday, it’s worth being a little skeptical.

“I think the market is taking that number with a little grain of salt,” said Ted Seifried of Zaner Ag Hedge, speaking on U.S. Farm Report with host Tyne Morgan. “The way USDA calculates its August yield is by taking an ear count--which is not a kernel count—and then they are applying their statistical analysis of the crop conditions, which is a 74% good to excellent. When you put that all together, it come up with a 175.1 national average, which is a huge number.”

But estimates, real-world sampling, and running combines in the fields are very different things.

“I think that once they get out into the fields to start actually pulling cobs and doing kernel counts, which will happen with the September report, that number could come down a bit,” Seifried added.

He pointed to 2014, which posted a record-breaking national yield of 171 bpa.  “I think the feeling in the trade might be that we’ve just seen the largest field estimate that we’ve seen,” Seifried said. “If you go back to ’14, you had the same sort of thing, when USDA got almost up to (an estimated national yield of) 175 and then had to reverse themselves back down.”

Seifried isn’t the only analyst thinking that USDA may have gone a little high in its August numbers. “A number like that (175.1), in our experience, could have easily taken us limit down and brought us to multi-year lows,” said Tommy Grisafi of Advance Trading, also speaking on U.S. Farm Report. Yet corn prices dropped just 7 cents after the report came out, suggesting that perhaps the big number wasn’t quite as big a deal to the trade as people might have expected.

“We always have this tendency to try to factor in a bigger yield than what the reality is,” Seifried acknowledged. “More often than not, things are not as good as they seem—and not as bad as they seem. This might be the same case here this year.”

Indeed, while Wisconsin and southern Minnesota growers are reporting favorable growing conditions and top crop conditions, other states are dealing with flooding or pockets of drought.

In North Dakota and northwest Minnesota, for example, crops are trying to recover from countless heavy rainfalls this summer. “The worst crops I’ve seen in 20 years,” a farmer from Walsh County, N.D., reported grimly on AgWeb’s Crop Comments section. “Have had 20 inches of rain in the last two months. Soybeans on the hills are now turning yellow. Edible beans are completely gone. Some wheat looked OK until a hailstorm came through and wiped a lot out. Lot of auction sales will be coming next spring.”

In parts of Ohio, New York, and Michigan, farmers are reporting dry, parched soils and struggling crops. “All you with such great crops should be thankful,” one farmer in Darke County, Ohio, told AgWeb’s Crop Comments section. “We here in Ohio (have not gotten) rain and our crops all drying up. Beans are very short. A total disaster in the making.”

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Spell Check

Alex Koehn
Brookston, TX
8/19/2016 01:31 PM

  Well I don't know how things look up north, but here in NE Texas we can't imagine a 175 bu. average. We started out the year with major flooding, then around June 1 the rain ended and we seen almost no rain for close to 2 months... The crops are a disaster. Even under irrigation they are poor due to all the water in the spring. The crops that are not harvest across the South are now being flooded again. I think the USDA needs to learn how to average!

Walton, IN
8/17/2016 08:47 AM

  I've driven all over Indiana the last three weeks and I can tell you we do not have a record 187 yield, not even close. Maybe 170....maybe. Southern Indiana is a train wreck with conditions similar to 2015. Late planted crops and lots of rain all summer. Central Indiana is a mixed bag, certain areas have had near ideal conditions all year and will produce very well this year. But all you need to do is maybe drive 15 miles and find areas where July and August rains were missed and are suffering from major tip back and dying plants. Northern Indiana is another train wreck, thin soils and little rain and lots of heat don't mix in that area and crops are showing it. I have found in my travels the best corn is East of Indianapolis, along US31 from Indy to Kokomo (Hamilton, Tipton, Howard and eastern Clinton and a long the state line north of Terre Haute to Attica to Benton and White and Northern Tippicanoe. Those areas are indeed some of the best growing areas and soils in the state but, they will not be enough of a bin buster to offset the rest of the state. That being said, my travels to Illinois have shown me they will probably have a record crop.

Osterdock, IA
8/17/2016 01:16 PM

  Last month I went to Wy across 20.and again this past week.. Iowa to wy the corn looks excellent...even the dry land corn across Nebraska looks excellent but that's from the road...walk in 17 rows it will be different...then we never hear about out east...they are big corn producers in Ohio that are burnt the guy above said about ind...New York might not be a big player in corn but...they do raise it and are burnt can't trust the USDA Numbers anymore...they just come out and pull numbers out their azz to benefit China...Like finding a few hundred thousand acres they didn't know we're planted to corn...BULL BOLOGNA...We have to certifie our acres by the end of June or pay a fine...they are just another inept dept of our government like the VA,FEMA ,ETC,etc...


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