USDA reduces 2012 corn, soybean and hay production forecasts

USDA’s Aug. 10 Crop Production report revealed what everyone expected: Sharply smaller 2012 U.S. corn and soybean crops due to drought-affected yield declines.

Corn production is forecast at 10.8 billion bushels, down 13% from 2011 and the lowest production since 2006. Based on conditions as of Aug. 1, yields are expected to average 123.4 bushels per acre, down 23.8 bushels from 2011. If realized, this will be the lowest average yield since 1995. Area harvested for grain is forecast at 87.4 million acres, down 2% from the June forecast, but up 4% from 2011.

The 2012 corn planted area for all purposes was estimated at 96.4 million acres, the highest planted acreage in the United States since 1937. However, widespread drought and extreme temperatures during June and July have had an adverse affect on the  crop.

USDA’s World Ag Supply & Demand Estimates report, also released Aug. 10, projects the 2012/13 season-average farm price for corn at a record $7.50 -$8.90 per bushel, up sharply from the $5.40-$6.40 per bushel projected in July. 

 

Soybeans

Soybean production is forecast at 2.69 billion bushels, down 12% from last year. Area for harvest is forecast at 74.6 million acres, down 1% from June, but up 1% from 2011. Harvested area, if realized, will be the fourth largest on record. However, yields are expected to average 36.1 bushels per acre, down 5.4 bushels from last year. If realized, the average yield will be the lowest since 2003. 

According to the WASDE report, the U.S. season-average soybean price is projected at $15.00-$17.00/bushel, up $2 on both ends. Soybean meal prices are projected at $460-$490/ton, compared with $365-$395/ton last month. 

 

Dry hay

While all eyes were on corn and soybeans, production of alfalfa/alfalfa mixture hay also took a hit. Production is forecast at 54.9 million tons, down 16% from last year. If realized, this will be the lowest production level since 1953. 

Harvested area is forecast at 18.8 million acres, unchanged from June, but down 2% from 2011. Based on Aug. 1 conditions, yield is expected to average 2.92 tons per acre, down 0.48 ton from last year. If realized, this will be the lowest U.S. yield since 1988. 

Some of the largest expected yield declines were evident in the Great Plains and Corn Belt. In portions of the West, producers used their fields to graze livestock, as below average irrigation water supplies limited the number anticipated cuttings. Conversely, producers in Arizona are expecting a record-setting yield in 2012 as much of the State’s crop is irrigated. 

Production of other hay is forecast at 65.4 million tons, down less than 1% from last year. However, if realized, this will be the lowest production level since 1990. Harvested area is forecast at 38.8 million acres, unchanged from June, but up 6% from last year. 

Yields are expected to average 1.69 tons per acre, down 0.12 ton from last year. If realized, this will be the lowest U.S. yield since 1988. With the exception of the Deep South, prolonged drought conditions in most states led to declines in yield potential for other hay this season. The most significant yield decreases are expected throughout the Corn Belt. Conversely, timely rainfall in areas along the Gulf Coast and into portions of the Southeast allowed for yield recovery in pastures and grass hay fields when compared with 2011. 

 

Cottonseed

One small bit of good news for dairy producers: cotton production is forecast at 17.7 million 480-lb. bales, up 13% from last year. As a result, 2012 cottonseed production is forecast at 6.012 million tons, up 12% from 2011.

 

To find the full Crop Production report, visit http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1046.

To see the full World Ag Supply & Demand Estimates report, visit http://www.usda.gov/oce/commodity/wasde/latest.pdf.