It’s a story the market has been talking about since this spring. Even with some weather hiccups, favorable weather is creating ideal growing conditions for much of the Midwest, and as a result, USDA now thinks the U.S. could see a record corn and soybean crop. The big changes in WASDE caused soybean prices to sink to new lows.
USDA’s August WASDE report increased both the corn and soybean yield and production estimates. The soybean scenario is for a record yield and production number, which sent soybean prices sliding lower since the report.
Monster Yields in the Midwest
The Midwest just may be sitting on a monster crop, according to USDA’s August report. The chart below shows year-over-year changes in yield.
USDA thinks Illinois could see the biggest state average yield at a whopping 225 bu. per acre. Iowa is forecast to reach 209 bu. per acre. Indiana isn’t far behind with a national average yield forecast to reach 207 bu. per acre.
The biggest yield increases include:
- Missouri: Up 18%
- Illinois: Up 9%
- Kansas: Up 6%
The crop isn’t a potential record everywhere with parts of the East Coast hammered by drought. The biggest decreases in yield forecasts include:
- North Carolina: Down 32%
- Pennsylvania: Down 14%
If USDA’s 183.1 bu. per acre national corn yield forecast comes to fruition this fall, it would be a new record.
A Sea of Soybeans
USDA’s yield forecast of 53.2 bu. per acre for soybeans is aided by big crops in the I-states. USDA currently projects Illinois, Iowa and Indiana to top 60 bu. per acre for an average state yield.
The biggest increases include:
- Kansas: Up 46%
- Louisiana: Up 22%
- Nebraska: Up 14%
- Virginia: Up 13%
The largest declines include:
- North Carolina: Down 6%
- Pennsylvania: Down 4%
- Tennessee: Down 4%
If USDA’s 53.2 bu. per acre national soybean yield forecast becomes a reality this fall, it would smash the previous record.
Update on Ending Stocks
USDA’s August report left old crop ending stocks unchanged compared to last month, but the agency made a historically large increase in its new crop ending stocks estimates.
USDA now forecasts new crop to increase 125 million bushels to 560 million bushels, and if realized, would be the third highest soybean ending stocks on record.
USDA’s August report showed old crop ending stocks are forecast to be 1.8 billion bushels, which is down slightly from last month. New crop is forecast to reach just over 2 billion bushels.
Changes to Acreage
USDA lowered its harvested corn acres forecast, from 83.4 million in July to 82.7 million in August.
The agency went the opposite direction with soybean acreage, increasing harvested acres by 1 million. USDA’s new forecast is 86.3 million harvested acres for soybeans.
