Farmland Forecast

Corn production estimates were decreased nearly 1% by the USDA, although analysts were expecting a larger reduction in today's World Agriculture Supply and Estimate report. Soybean production estimates were increased for the second consecutive month, which was in opposition with expected declines from sector analysts. Wheat exports continued to decline due to increased global production. Global production of wheat in 2015/16 is expected to break a record, the third in a row if realized.

Corn

The USDA estimated U.S. corn production for the 2015/16 crop season 101 million bushel lower, to 13.585 billion bushels, in the September WASDE report, due mainly to the reduction in average yield, 168.8 to 167.1 bushels per acre. U.S. corn usage for 2015/16 was lowered 20 million bushels but is still expected to be a record high. Feed and residual use for 2015/16 was lowered by 25 million bushels in accordance with the smaller expected crop.

Corn ending stocks for 2015/16 were decreased 121 million bushels to 1,592 million bushels. Ending stocks were decreased in part to the lower expected production and use. The projected season-average price range for corn in 2015/2016 was projected at $3.45 to $4.05 per bushel, 10 cents higher on both ends.

World corn production for 2015/16 was projected at 978.1 million tons, a 7.5 million ton decrease from last month due to lower expected production from the E.U. and U.S.

U.S. Crop Production (Million Bushels) 2015/16

U.S. Ending Stocks (Million Bushels) 2015/16

U.S. Average Yield (Bushels Per Acre) 2015/16

Soybeans

U.S. soybean production for 2015/16 was reported at 3.935 billion bushels, a 19 million bushel increase from last month. The average U.S. soybean yield was projected at 47.1 bushels per acre, a 0.2 bushel per acre increase from last month. Ending stocks for 2015/16 were estimated at 450 million bushels, a 20 million bushel decrease from August, due to lower beginning stocks and higher expected use. The U.S. season-average price forecast for soybeans in 2015/2016 was projected at $8.40 to $9.90 per bushel, unchanged from August.

Global soybean production was projected at 319.6 million tons for 2015/16, a 0.4 million ton decrease from last month due mainly to the reduction in Ukraine production.

Wheat

U.S. Wheat ending stocks for 2015/16 increased 25 million bushels to 875 million, the highest level since 2009/10.  Wheat exports for 2015/16 were lowered due to increased foreign supplies, 925 million bushels to 900 million bushels. The projected 2015/2016 season-average price was lowered 20 cents on the high end to $4.65 to $5.35 per bushel.

Global wheat supplies for 205/16 were increased by 6.7 million tons, mainly due to increases in production from the EU and FSU. The global wheat production is estimated at 731.6 million tons, if realized would be a third consecutive record.

Outlook

Early indications from farmers in southern growing areas, where corn and soybean harvest has begun, are that yields are below expectations. Crop condition estimates in these areas have been above average, so the less than stellar realized yields are disconcerting to farmers. The early reports of lower than expected yields have provided some upward support to corn and soybeans prices, although no significant price movement is realistic until realized yields start coming out of the predominant growing areas in the Corn Belt. 

The weather forecast for September shows above average temperatures for the central and eastern Corn Belt, and average temperatures in the west. Slightly above average rainfall across the entire Corn Belt is expected, with more expected in the western Corn Belt than the east. Warmer temperatures should improve corn and soybean growing progress and expedite the crops to maturity.

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