By Dan Grant/RFD Farm Week Now
BLOOMINGTON – Most corn and soybeans are in the bin nationwide, but the crops keep growing on paper.
USDA surprised the trade Wednesday when it bumped up its national yield estimates by 1.9 bushels per acre for corn and 1.1 bushels per acre for beans.
National yields now sit at a record 175.3 bushels per acre for corn and 52.5 bushels per acre for beans.
“The big headliner for corn was the big jump in the yield estimate,” Brian Basting, market analyst with Advance Trading, said during a teleconference hosted by the Minneapolis Grain Exchange.
“That was a bit surprising,” he continued. “That brings more of a negative feel to the corn report.”
The boost to the national corn yield, after a 1-bushel reduction last month, pushes total corn production to a record 15.23 billion bushels, up 168 million bushels from a month ago.
“After dropping in October, that really was an unusual move (by USDA to boost the corn yield this month),” Dale Durchholz, AgriVisor senior market analyst, told the RFD Radio Network. “That was maybe a bigger surprise than the beans, which also were raised more than the trade thought.”
The record soybean yield adds 92 million bushels to the soybean production estimate, which now sits at a record 4.36 billion bushels.
The record production estimates dragged prices down about 10 cents per bushel for corn and 15 cents for beans last week following the release of USDA’s monthly world supply and demand estimates report.
USDA also raised ending stocks by 83 million bushels for corn, to 2.4 billion bushels, and by 85 million bushels for beans, to 480 million bushels. Traders prior to the report expected soybean ending stocks to total around 420 million bushels.
“That (soybean ending-stocks estimate) is weighing on the market quite a bit,” Basting said.
On the bright side, USDA raised soybean exports by 25 million bushels to 2.05 billion bushels and boosted corn used for ethanol by 25 million bushels from a month ago.
Export projections remained unchanged for corn (2.23 billion bushels) and wheat (975 million bushels).
“USDA did tweak usage, but it was not enough to offset production,” Basting said.
“Farmers now should focus on defending the balance sheet,” he noted. “Establish a floor for these record crops.”
USDA last week raised its season-average price projections by a nickel for corn ($3-$3.60 per bushel) and 15 cents for beans ($8.45-$9.95).
