Latest Government Reports Show Record Corn, Soybean Production

Jesse Newman reported yesterday at The Wall Street Journal Online that, “Government forecasters again boosted their outlook for a record U.S. soybean harvest but stopped short of the crop projections that have unnerved investors over the past several months.

Corn production is also set for a record year and with plentiful domestic supplies of other crops such as wheat and rice, the U.S. has become more reliant on export markets to absorb the bumper harvests.”

Ms. Newman indicated that, “U.S. farmers are expected to harvest a record 4.269 billion bushels of soybeans, just shy of analysts’ expectations. The bump-up yield of 51.4 bushels an acre following August rains was in line with trade guesses, with some concerned yields could top 52 bushels…[T]he [USDA] expects [corn] production to reach a record 15.057 billion bushels on yields of 173.4 bushels an acre this fall.”

Graph From USDA

Reuters writer Timothy Ahmann reported yesterday that, “Expectations for bumper harvests have weighed on corn and soybean prices for months. Soybean futures have sagged 21 percent from their 2016 peak hit during mid-June while corn has fallen 22 percent during the same time period.”

In a separate report (World Agricultural Supply and Demand Estimates- WASDE) yesterday from the World Outlook Board indicated that, “The projected range for the season-average corn price received by producers is raised 5 cents on both ends to $2.95 to $3.55 per bushel.”

The WASDE report added that, “The soybean price is projected at $8.30 to $9.80 per bushel, unchanged from last month.”

University of Illinois agricultural economist Darrel Good discussed the government reports in more detail yesterday in an interview with Todd Gleason, a replay of that conversation is available here.

Meanwhile, Iowa State University ag economist Chad Hart indicated yesterday that, “With production approaching 4.3 billion bushels, the soybean market has never had more beans to work with. So again, it’s a story of record supplies and demand, but demand growth lags behind supply growth.”

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