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Crop production report: Soybean outlook improved

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USDA updated its Crop Production report, Oct. 11, showing the corn crop continuing to slide, but the soybean crop recovering a bit compared to a month ago.

 

Corn production is forecast at 10.7 billion bushels, down slightly from the September forecast and down 13% from 2011. This represents the lowest U.S. production since 2006. Based on conditions as of Oct. 1, area harvested for grain is forecast at 87.7 million acres, up less than 1% from the September forecast and up 4% from 2011.

 

Yields are expected to average 122.0 bushels per acre, down 0.8 bushel from the September forecast and 25.2 bushels below the 2011 average. If realized, this will be the lowest average yield since 1995.  The October 1 corn objective yield data indicate the lowest number of ears per acre since 2005 for the combined 10 objective yield states (Iowa, Illinois, Indiana, Kansas, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin). 

 

Aided by mild, mostly dry weather in the Midwest, corn producers were harvesting the nation’s crop at one of the quickest paces on record. Fifty-four percent of the intended grain acreage was harvested by Sept. 30, 36% ahead of last year and 34% ahead of the 5-year average pace. 

 

According to USDA’s World Ag Supply & Demand Estimates report, the season-average farm price for corn was lowered 10¢ on both ends of the range, to $7.10-$8.50/bushel, based on early season cash and futures prices and prices available for forward delivery through early 2013.

 

Soybean production is forecast at 2.86 billion bushels, up 9% from September, but down 8% from last year. Area for harvest is forecast at 75.7 million acres, up 1% from September and up 3% from 2011. If realized, harvested area will be the third largest on record. 

 

Based on Oct. 1 conditions, yields are expected to average 37.8 bushels per acre, up 2.5 bushels from last month, but down 4.1 bushels from last year. Compared with last month, yield forecasts are higher or unchanged across all states. The October objective yield data for the combined 11 major soybean-producing states (Arkansas, Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Ohio and South Dakota) indicate a lower pod count compared with last year, as hot, dry weather during bloom hampered development of the crop in many areas. Compared with final counts for 2011, pod counts are down in all states. The largest declines from 2011’s final pod counts are expected in Illinois, Missouri and Nebraska, all down more than 570 pods per 18 square feet. 

 

Harvest progress, at 41% complete as of Sept. 30, was 26% ahead of last year’s pace and 22% ahead of normal. Harvest progress was more than 50% ahead of normal in Minnesota, North Dakota and South Dakota.

 

The U.S. season-average soybean price range for 2012/13 is projected at $14.25-$16.25/bushel, down 75¢ on both ends of the range. The soybean meal price is projected at $470-$500/ton, down $15 on both ends of the range.

 

Dry hay production

Looking at the dry hay harvest, USDA estimated production of alfalfa/alfalfa mixture hay at 55.6 million tons, up 1% from August, but down 15% from last year. If realized, this will be the lowest production level since 1953. Based on Oct. 1 conditions, yield is expected to average 2.95 tons per acre, up 0.03 ton from August, but down 0.45 ton from last year. If realized, this will be the lowest United States yield since 1988. Harvested area is forecast at 18.8 million acres, down 2% from 2011. 

 

Monsoonal moisture in the Southwest led to expected increases in alfalfa hay yield throughout the region. Similarly, increased rainfall in the eastern Corn Belt allowed producers to harvest additional cuttings from what was anticipated in August. Conversely, above average temperatures and limited rainfall continued to plague much of the Northern Tier, western Corn Belt, and central Great Plains during September, causing further depletion of soil moisture levels. Forecasted alfalfa hay yields throughout most of these regions declined compared both to August and last year. Some of the largest expected yield declines were evident in the Great Plains and Corn Belt, where temperatures have remained warmer than normal and precipitation totals have been less than 50% of normal since July. 

 

Production of other hay is forecast at 66.4 million tons, up 1% from both the August forecast and last year. If realized, this will be the second lowest production level since 1990. Based on Oct. 1 conditions, yields are expected to average 1.71 tons per acre, up 0.02 ton from August, but down 0.1 ton from last year. If realized, this will be the lowest U.S. yield since 1988. Harvested area is forecast at 38.8 million acres, up 6% from last year. 

 

Beneficial rainfall during September boosted growth in many grass hay fields and pastures throughout much of the eastern half of the United States which led to expected increases in forecasted other hay yields when compared with both August and 2011. Conversely, scarce August and September precipitation intensified prolonged drought conditions across much of the Northern Tier and in the Rocky Mountains prompting even larger declines in yield potential for other hay this season when compared with last year. 

 

2012 cottonseed production was forecast at 5.868 million tons, up 58,000 tons from September’s projections, and 9% more than a year ago.

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