USDA’s October WASDE report caught the corn market off guard Friday. The agency raised its national corn yield by nearly 3 bushels per acre to 181.2 bu. per acre, lifting production 234 million bu. to 16 billion bu. Corn ending stocks climbed 282 million bu. to about 1.85 billion bu., well above what the market expected.
With harvest underway, the frustration among farmers is rising. Not only do they now face tougher choices on when to sell, the one report caused corn prices to sell-off, costing farmers. Corn futures fell around 5%, with soybeans and wheat also under pressure.
One Missouri farmer says while he had already sold some of his new crop corn, he hadn’t sold enough. Friday’s move alone cost him about $40 per acre, even though he had some of his crop priced. For a farmer with 2,000 unpriced acres, that one report would amount to an average of $80,000 lost in a single day.
All Eyes on Nebraska
Much of the national increase traces back to one state. USDA raised Nebraska’s corn yield estimate by 11 bu. per acre to 188 bu. per acre in the October report. For context, USDA’s August forecast for Nebraska was 183 bu. per acre, so the September-to-October jump more than recovered a drop in between. But the question is why did Nebraska see such a major increase in a single month.
The size of the jump is drawing scrutiny because of what the field sample data shows.
- In September, the data suggests about 90% of the Nebraska fields sampled were nonirrigated, only 10% irrigated
- In October, the balance of ear counts was a more typical measurement, with 55% irrigated and 45% nonirrigated.
The samples are collected by the National Association of State Departments of Agriculture (NASDA) for USDA’s National Agricultural Statistics Service (NASS), and the shift has farmers and analysts asking why irrigated fields appeared to make up only 10% of the September sample.
How USDA Generates Yield Forecasts in October Report
Seth Meyer is director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri. He served as USDA’s chief economist for five years and knows how the yield data is gathered. He says the change between September and October is built into the process.
“You’re switching from field-level counts, so they’re going out into the field and you’re getting farmer reporting,” Meyer says. “Now they’ve actually got harvest results. So you’re transitioning from pure field level without harvest for a maturing crop into a combination of that and farmers’ actual results.”
Meyer says that’s why an October yield change wasn’t a complete shock to him. He had told AgWeb before the report that USDA could surprise the market by going higher.
“October changes in yield are not uncommon when you have that kind of transition,” Meyer says, adding that large yield changes are less common from here forward, because farmers are now reporting actual yields.
No matter how USDA calculates yield in September to October, there is a glaring issues that came through with this report, specifically yield samples in Nebraska. AgriTalk AM host and Farm Journal Economist Chip Flory is following this issue closely.
“The September anomaly in Nebraska was detected because there are three data points to reconcile – irrigated, non-irrigated and all. In other states, there is just one data point. That doesn’t tell us if the sample count was at planned levels,” explains Flory. “Because the ear counts are ‘raw data,’ counts for Iowa could have been based on one field or 500 fields – there’s no way to tell. That’s why this is so important. The Nebraska problem in September could be an isolated problem, but it is possible this is a broader problem, not a one-state problem”
Flory says he does not question the methodology used in October and agrees the transition from survey-based estimates to actual harvest results is very important.
“But only 15% of the Nebraska corn crop was harvested as of October 4. That means field observations from NASDA enumerators still likely carried significant weight in the October crop estimate from NASS,” Flory points out.
Does the Increased Irrigated Sample in Nebraska Explain It?
Meyer doesn’t believe the swing in the sample mix explains the 11-bu. increase. NASS publishes plant counts by irrigated and nonirrigated fields, he says, but it doesn’t publish how those samples are weighted to reach a state yield.
“While there may have been an issue in terms of how many acres you were able to survey in the sample, it isn’t because of how they weighted irrigated versus nonirrigated that caused the increase in yields,” Meyer says. “When you are not getting your full sample, there’s a bigger chance of error. That’s absolutely part of it,” he says. “But look at the nonirrigated sample as well.”
For Flory, this reiterates the point of needing answers from NASS.
“If what Meyer is saying here is correct and the September Crop Production Report did not get a ‘full sample,’ that’s exactly why we need to understand why it was not a full sample,” says Flory. “Was it an isolated problem or is it an issue that is more widespread?”
“It Seems a Little Bit Sketchy”
Darren Frye, president and CEO of Water Street Solutions, agrees Nebraska is the story. He says the state accounted for about half of the total national increase.
“It was about half of the total increase. It represented 1.2 bushels over the national average,” Frye told Michelle Rook on her Markets Now podcast. “But obviously, there was another 1.5 from other places. A lot of it came from the Plains states, and very little of it came from anywhere else.”
It wasn’t just Nebraska. South Dakota’s yield was up 6 bu. to 151 bu. per acre, Texas was up 8 bu., Kansas was up 9 bu. and North Dakota was up 2 bu.
Frye questions how the Plains numbers square with the growing season.
“I don’t know how we had those types of moves when you have a 46% good-to-excellent Nebraska crop,” he says. “We’ll have to see if they adjust this back down in November, if this is the number we have to live with.”
Frye also points to the jump in ear counts as the major red flag in the October report.
“Ear counts went up 1,700 ears per acre in Nebraska. That seems like a big change from September,” Frye says. “I know they used more irrigated plots this time than nonirrigated plots. I don’t know why they switched that from September to October, other than they were trying to correct a mistake. But it seems a little bit sketchy when you have a lot of nonirrigated fields in Nebraska yielding under 110 bu. per acre, and we know last year they were pretty much record yields. So you just wonder how they’re going to come up with a yield anywhere close to 188 for Nebraska.”
His bigger concern is how the new numbers compare with last year’s crop, and considering how good the crop was last year in the Plains, that piece is also making him question the accuracy of the latest report.
“You would think that just because of how they blew it out of the water last year, you’d be lower than last year. This year’s weather makes it much lower than last year, and to see some of these yields come in pretty close to last year, like Nebraska for example, 188 bu. per acre versus 194 bu. per acre. That’s awful close to the same crop, and you had an excellent year versus not such an excellent year. So a lot of questions, and a lot of the answers from NASS will have to be dealt with over the next month or two.”
Is a Staffing Shortage to Blame?
The big question in Nebraska, according to Meyer, is why enumerators didn’t reach those irrigated fields in the first place. Irrigated and nonirrigated ground is “sprinkled amongst each other,” he says, so he wonders whether a geographic problem kept crews out of certain areas.
“I think that’s a legitimate question,” Meyer says. “I expect NASS will answer that.”
He doesn’t think a staffing shortage is the answer as to why NASDA didn’t sample more irrigated fields in September, otherwise you’d see sampling issues across a wider geography.
“If you were just short everywhere, then you wouldn’t see the skew of irrigated versus nonirrigated,” Meyer says. “So I think it has to be a geographic issue. I don’t know why.”
But other critics aren’t so sure staffing issues aren’t to blame. As one analyst told AgWeb, it’s possible NASDA didn’t have enough staff to collect the data in Nebraska.
Which Report is More Reliable?
After digging through the numbers, Meyer says he has more confidence in October than in September.
“I like the fact that they got out to those irrigated fields and were able to look through them,” he says. “If there was a concern, it might have been the September one, where you didn’t get into those irrigated fields and your potential error on irrigated yields was higher.”
Falling survey response rates are an issue. And according to Meyer, they are a concern about the impact on yield reports.
“Any time you have falling response rates, you worry about how much it hinders your accuracy,” Meyer says. NASS is trying to compensate with other techniques, he says, “but it’d be even better if farmers would respond.”
Farmer Frustration is Legitimate
With the report reaction on Friday, there’s no denying farmers are frustrated, especially considering this is the report the market will trade.
“The number that’s printed is the number that the algorithms trade. It clearly changes the trajectory of everything that we’ve thought for some time,” says Matt Bennett, of AgMarket.Net.
As for when USDA might revise the number, if ever, Frye says farmers shouldn’t count on it.
“We could be stuck with this yield somewhere between 179 and 182 bu, per acre all the way through,” he says. “Then it comes down to the stocks report. Was the crop really that big? It’ll show up in the stocks reports, but that’ll probably be March before we see that. I don’t think we have enough data in the December one. So we could live with this type of yield, this type of carryout, for some time.”
Meyer says farmer frustration is understandable, especially when one report can move the markets like Friday’s report did.
“Margins are poor. These people have their livelihoods on the line,” he says.
But he doesn’t think farmers deciding to pull back from answering surveys is the solution.
“I don’t think withdrawing your support and responses is the best answer either,” Meyer says.
He says NASS needs to keep being transparent and explain what happened in the field. He also sees a gap in how the data is understood.
“We have a knowledge gap between statisticians who say, ‘Well, clearly this is the number,’ and what people understand that to be,” Meyer says. “We’ve got a gap that we need to try and close.”
A Look at the Balance Sheet
Moving forward, Meyer says the bigger crop adds to a balance sheet he already watches closely. He says the feed and residual number for 2025-26 looked too large relative to animal numbers, and it still looks high for the coming year.
“Now we’ve got a little bit of a bigger crop,” Meyer says. “We’re really going to have to watch that disappearance as we go forward.”
