They came from as far as Argentina and Singapore to walk among the soybean plants and corn stalks of the U.S. Midwest. What they found was evidence of a record soybean crop, and a corn crop that’s also huge but not quite as big as previously thought.
The annual Pro Farmer Midwest Crop Tour, which ended Thursday in Rochester, Minnesota, has seen dozens of people -- among them grain traders, analysts and money managers -- travel through seven states measuring the yield potential in more than 2,000 corn and soybean fields.
Corn yields will average 171.3 bushels per acre, according to the average estimate of 15 tour participants surveyed by Bloomberg. That would just eclipse the record yield of 171 bushels recorded in 2014, though it trails the record 175.1 bushels forecast by the U.S. Department of Agriculture on Aug. 12.
The tour is an important indicator for the grain and oilseed markets, with North American harvests a few weeks away. Even if U.S. corn yields fall below expectations, the evidence gathered this week shows it’s likely that U.S. farmers will reap a record volume after boosting acreage to the third-highest since World War II. The USDA is also forecasting global reserves climbing to their highest ever next year, and corn futures in Chicago are currently headed for a fourth straight annual decline.
“Even if the U.S. crop yields less than 170 bushels, there will be a lot of corn,” said Gautier Maupu, a consultant at Paris-based advisory company Agritel and tour participant. “When you add that to the world supply, the price has limited upside, especially with the harvest coming fast.”
While U.S. corn fields “dodged bullets” all season, a variety of adverse weather conditions still dented production potential, Chip Flory, editorial director of Pro Farmer, the company that puts on the tour, said Thursday. Some of the crop was hurt by an early cold snap in the northern part of the Midwest, heat in late June that stressed corn ears as they formed kernels, and above-normal temperatures that hampered the amount of sugar available to make heavy ears after pollination.
Those challenges were reflected in what the tour "scouts" found as they traveled hundreds of miles each day by car on pre-planned routes, stopping off at regular intervals to walk into fields to count viable corn ears and grain kernels. Corn-yield samples taken in Minnesota, Nebraska and South Dakota dropped below the tour’s average from a year earlier, while they rose in Iowa, Illinois, Ohio and Indiana.
“It will be a good crop, maybe even a record crop, but it will just not be as outrageous as they were saying,” Robert van der Kooy, an analyst at Rotterdam-based Nidera BV who was one the tour, said Thursday in an interview. “I’m really confident that the samples we pulled and that the general opinion and general direction in this tour comes very close to what USDA will come out with eventually.”
Soybean yields are seen at 48.8 bushels an acre, according the average of 14 estimates from tour participants. That’s just shy of the USDA’s latest projection for 48.9 bushels, an all-time high. The average number of pods on plants -- measured in the field on random three-square-foot plots -- rose in four of the tour’s seven states. Midwest farmers will begin harvesting the oilseed in less than a month.
“I kind of like the number after seeing this crop,” Flory said of the USDA’s forecast. “It’s got water to finish” filling pods with plump beans, boosting output.