Iowa Corn and Soybean Growers Respond To USDA Crop Report

Iowa Corn and Soybean Growers Respond To USDA Crop Report

Association leaders say despite lower U.S. crop size in 2010, there will be enough corn and soybeans to ensure that needs will be met - and that includes exports.

Even with the reduced crop size estimate for corn issued by USDA on October 8 in its October Crop Report, corn farmers will be able to meet all demands for food, feed, fuel and exports. That's what National Corn Growers Association officials say in response to USDA's reduced projection for 2010 corn production. The harvest of 12.7 billion bushels, the third-largest crop in U.S. history, will still provide a surplus or ending stocks of nearly 1 billion bushels when the 2010-11 corn marketing year ends next August 31.
 
"Farmers are working hard to bring in a great crop this year, despite the many challenges," says NCGA president Bart Schott, a North Dakota grower. "We have heard many reports of lower yields and, at the same time, are hearing stories of higher-than expected yields in some areas. This may not be a record year for yields or for total corn production, but we are bringing in the corn and we are meeting all needs, even for our export markets."
 
The USDA reduced the estimated 2010 national average corn yield from 162.5 to 155.8 bushels per acre—that's comparing the September Crop Report to the October Crop Report. USDA has reduced its estimate of overall corn production from 13.2 billion bushels to 12.7 billion bushels for the 2010 crop. Corn use for the 2010 marketing year which began September 1 is projected at 13.5 billion bushels. The beginning stocks of 1.7 billion bushels of corn on September 1, 2010 will help ensure that all needs are met, says Schott.

Lower U.S. supplies offset by more foreign grain production

"A global perspective is important," says Schott. "Global coarse grain supplies are nearly unchanged, and lower U.S. supplies are offset by increased foreign grain production. We expect farmers in South America to respond to these market signals, just as we know U.S. farmers will do when it comes time to make planting decisions for the 2011 crop."
 
Schott notes that, as of Oct. 3, only 37% of the U.S. corn crop was harvested and that much of what has been harvested to date was in the areas most adversely impacted by the summer weather. He sees the potential for an upward adjustment in the overall production number as the harvest is completed.

Iowa numbers reported in USDA's October Crop Report are for a 2.2 billion bushel crop in the Hawkeye state, down from 2.4 billion bushels in 2009. USDA is now forecasting an Iowa yield average of 169 bu. per acre versus 179 bu. per acre in September. Iowa farmers harvested a statewide average of 182 bu. per acre in 2009. Many growers across the state had wet, warm conditions as well as other weather events during the 2010 growing season that caused the change.

Corn carryover stocks, production to ensure needs will be met

"We now have corn hybrids that continue to produce even under the extreme weather conditions we had across the state this year," notes Dick Gallagher, a farmer in Washington County in southeast Iowa, who is chairman of the Iowa Corn Promotion Board. "In my area of the state, we had more than enough water this spring and summer. But, I think, even with the slight down tick in this year's crop size, I am confident the U.S. will have the corn that is needed."

Gallagher notes that "Iowa corn farmers are still bringing in this 2010 harvest, so keep in mind that USDA's October Crop Report is just a forecast. The final report is when the corn is on the barge, at the ethanol plant, down the rail, or in the bin."

U.S. corn production, forecast at 12.7 billion bushels, is down 4% from the September forecast and down 3% from last year's record production of 13.1 billion bushels. Based on conditions as of October 1, the U.S. yield this fall is expected to average 155.8 bushels per acre, down 6.7 bushels from the previous month and 8.9 bushels below last year's record of 164.7 bushels.

Corn yields are down from last month in much of the Corn Belt

Forecasted yields decreased from last month throughout much of the Corn Belt and Tennessee Valley. Illinois showed the largest decline, down 14 bushels per acre. Indiana and Iowa are both down 10 bushels from the previous month, while Missouri and Nebraska declined 9 bushels per acre. Area harvested for grain is forecast at 81.3 million acres, up less than 1% from the September forecast.

 

U.S. Crop

Billion Bu

U.S. Yield

Bu/Acre

Iowa Crop

Billion Bu

Iowa Yield Bu/Acre

2009 Final

13.151

165.2

2.439

182

2008

12.101

153.9

2.189

171

2007

13.074

151.1

2.368

171

2006

10.535

149.1

2.050

166

2005

11.112

147.9

2.163

173

2004

11.807

160.4

2.244

181

2003

10.089

142.2

1.884

157

2002

8.997

129.3

19.63

165

Stats from USDA/NASS

The USDA's WASDE report shows that corn production is forecast 496 million bushels lower as a 258,000-acre increase in harvested area is more than offset by a 6.7-bushel-per-acre reduction in yield. As forecast, this year's yield and production still would be the third highest on record.

Iowa pegged to harvest 52 bushels of beans per acre this fall

According to USDA's October Crop Report soybean production for 2010 in the U.S. is estimated at 3.408 billion bushels, down from the September estimate of 3.483 billion bushels. The average yield for the U.S. is estimated at 44.4 bushels per acre, down from 44.7 bushels estimated in September. For Iowa, soybean production is estimated at 512 million bushels. Yield estimates for Iowa are for an average of 52 bushels per acre; that is unchanged from September.

Meanwhile, the U.S. ending stocks estimate for soybeans for the 2010 crop marketing year that will end August 31, 2011 has been lowered. USDA has dropped that number from 350 million bushels that was estimated last month to 265 million bushels based on these new October crop numbers.

Kirk Leeds, who heads the Iowa Soybean Association, was a bit surprised by the lower soybean crop estimate nationally. "I have been hearing pretty solid yield reports," he says. "Certainly, Iowa has some challenging pockets, but even in areas with some ponding, the overall field averages have been pretty good."
Leeds adds, "Lower overall production really tightens the anticipated carryover numbers for the end of the 2010-11 crop marketing next August 31. This is another reason ISA needs to stay focused on funding research and other efforts to increase yields while lowering production costs."

Demand for beans expected to stay strong, based on exports

While the biggest surprise was the drop in corn yields, ISA Director of Market Development Grant Kimberley says this should still be friendly for soybeans. "Demand continues to remain strong, especially in light of a weaker dollar, which makes our prices not seem as high to foreign buyers," he says. Recalling ISA's recent trade mission to China, Leeds says, "In a demand driven market, we need to aggressively seek to claim as big of share of the increasing pie as we can."

Kimberley expects U.S. farmers will see an acreage battle this coming winter and spring for corn, soybeans and wheat due to continued strong demand and this year's lower corn and soybean production.

TAGS: USDA
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