Soybean development has been slow. According to USDA’s latest Crop Progress report, only 60% of the nation’s soybeans were in the bloom stage, compared with an 81% five-average and 84% last year. Only 16% of the nation’s beans had reached the pod stage, compared with a five-year average of 45% for this time of year. Crop condition, however, was rated 88% fair to excellent.
This week’s focus will be on the August 11 Crop Production report, which will contain three important numbers for soybeans. First, UDSA will update planted acreage numbers for Montana, Minnesota, North Dakota, and South Dakota, where planting was so late that it spurred USDA to resurvey the region. Frayne Olson, agricultural economist with North Dakota State University, thinks U.S. planted soybean acreage won’t change much.
The numbers people will really key into, he says, are the yield estimate, which is the first field-survey-based estimate of the year, and the harvested acreage estimate. The harvested acreage estimates from USDA’s July World Agricultural Supply and Demand Estimates (WADE) of 74.3 million acres—a 1.4-million-acre reduction from the June report—was considered too optimistic by some industry analysts. “Levies were broken. There were thousands of flooded acres in the Mississippi and Missouri River Valleys,” Olson says. “And that’s pretty productive farmland.”
While both global and U.S. soybean stocks are ample, the soybean crop is now in or headed into its critical pollination period. If too much crop stress occurs, stocks could go from comfortable to tight fairly quickly, according to Olson. “If the soybean plant is stressed—it’s too hot, dry, or windy—the flower will abort and you won’t get a pod,” he says. “There are already concerns in the South that there is yield damage.” Yields can be hurt due to aborted flowers, pollen that has died before fertilizing the plant, or if the number of seeds in the pod drop from three to two.
In July’s WASDE report, USDA predicted a 2011-12 average soybean yield of 43.4 bushels per harvested acre, compared with 43.5 bushels per acre last year. Allendale, a private research firm in McHenry, Ill., expects USDA to lower its yield estimate to 42 bushels per acre when it releases its new projection next week.
Looking longer term, a new report from Oil World says growers in Brazil will likely plant 61.2 million acres of soybeans this year, an increase of only 0.2% from last year, while strong corn prices spur a 4% rise in corn acreage to 50.2 million acres.
At the same time, Chinese soybean imports could slow somewhat. “In 2008, the Chinese government got scared when international commodity prices spiked and decided to build its soybean stocks,” says Phil Abbott, Purdue University economist. The resulting panic buying pushed China’s stocks-to-use ratio for soybeans from about 4 percent to 23 percent, or from about 3 million metric tons to 18 million metric tons by the end of 2010. “We believe the Chinese now have sufficient stocks levels, and that could slow their overall rate of growth of purchases in coming years.”
Additional Analysis on Thursday
Following the report releases Thursday morning, visit AgWeb.com for complete report news, data and analysis.