In Reality It’s the Size of the Crop That Matters, Not Yield

October 5, 2012 07:25 AM

Yield is (obviously) a major factor in determining crop size, but harvested acreage tallies this year could have just as much impact — especially for corn. A great example is our corn crop estimate of 10.478 billion bu. compared to PF crop consultant Dr. Michael Cordonnier’s estimate of 9.87 billion bushels. That’s a 600-million-bu. difference in crop estimates, but our yield estimate of 120.25 bu. per acre is only 1.25 bu. above Dr. Cordonnier’s current estimate of 119 bu. per acre.

The difference is harvested acres. We estimate harvested acres at 87.141 million; Dr. Cordonnier anticipates just 83 million acres of corn will be harvested for grain this year.

The October Crop Production Report is traditionally the first report of the year that USDA’s National Ag Statistics Service (NASS) taps into certified acreage data from the Farm Service Agency to adjust estimates made in the June Acreage Report. Our analysis of the FSA data suggests corn and soybean planted acreage estimates will be higher than estimated in June, but our observations on Crop Tour suggest a lower-than-normal harvested acreage percentage for both crops (just not as low as anticipated by Dr. Cordonnier).

USDA adjustments to harvested acres could be the factor that drives corn and soybean price trends through the end of the year.

Don’t ‘fear’ an increase in corn or soybean crop estimates —

If USDA finds bigger corn and soybean crops than estimated in September, jump straight to the bottom line of the Supply & Demand balance sheet for perspective. Because 2012-13 corn and soybean use is already estimated at very low levels, a bigger crop would allow USDA to add back some demand to hold carryover near the September estimates of 733 million bu. of corn and 115 million bu. of soybeans. Also, USDA’s Sept. 1 corn stocks tally of 988 million bu. (2012-13 beginning stocks) was down 193 million bu. from the September S&D Report. The impact on 2012-13 total corn supplies was like losing 2.2 bu. per acre from the national average corn yield.

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