USDA lowers corn yield projections

 

As expected, USDA decreased the expected 2019 national average corn yield by 1.4 bushels per acre and decreased the total 2018 U.S corn production by 118 million, compared to October USDA estimates. The estimated national average soybean yield and the total 2019 soybean production level in the November USDA Report were kept the same as the October levels.  

 

The latest USDA Report, released Nov. 8, estimated the total U.S. corn production for 2019 at 13.66 billion bushels — similar to 2015 numbers — and below 14.42 billion bushels in 2018 and the record of 15.15 billion bushels in 2016. 

 

USDA is estimating the 2019 national average corn yield at 167 bushels per acre, which would be the lowest national average corn yield in the past six years. Projected 2019 U.S. harvested corn acreage is 81.8 million acres, nearly flat from last year.

 

The USDA Report estimated 2019 soybean production at 3.55 billion bushels, down significantly from over 4.4 billion bushels in both 2018 and 2017. Soybean yield is estimated at 46.9 bushels per acre, down from 50.6 bushels per acre in 2018 and the record of 52.0 bushels per acre in 2016. The 2019 harvested soybean acreage is projected at 75.6 million acres, down from 87.6 million acres in 2018.  

 

Minnesota is projected to have a 2019 corn yield of 170 bushels per acre, which was lowered 3 bushels from the October estimate. This is 12 bushels per acre below 2018’s 182 bushels per acre and the record of 194 bushels per acre in 2017. Other state estimates for 2019 yield are:

Indiana, Illinois and Nebraska all had lower estimates from 2018, and Missouri was the only Midwest state with a higher projected yield than last year’s.

 

USDA is estimating the 2019 Minnesota soybean yield at 45 bushels per acre, down from 49 bushels per acre in 2018 and the record of 52 bushels per acre in 2016. Other state estimates for 2019 yield are:

Illinois and Indiana also saw significant drops while Nebraska saw a smaller decline.

 

 

The monthly USDA World Supply and Demand Estimates Report, also released Nov. 8, showed lower overall 2019-20 U.S. corn supply estimates than existed in 2018-19. It also showed a slight decrease in total corn demand levels for the coming year, pushing down projected corn carryout levels by the end of the 2019-20 marketing year. 

 

Total demand for corn usage in 2019-20 was lowered by 559 million bushels from 2018-19 levels, due to an expected reduction in livestock feed use and export levels. Corn used for ethanol production was projected to remain similar to a year earlier.

 

USDA is now estimating 2019-2020 U.S. corn ending stocks at 1.91 billion bushels, which compares to carryout levels of 2.11 billion bushels in 2018-19. Interestingly, USDA projected a market-friendly corn carryout level of only 1.74 bushels for 2018-19 a year ago in November.. 

 

The U.S. corn carryout to use ratio would be 13.7 percent for 2019-20, which compares to 14.6 percent for 2018-19. This means there could be some potential for short-term rallies in the cash corn market in the coming months, especially if USDA makes further downward adjustments in the final 2019 U.S. average corn yield.

 

The 2019-20 U.S. soybean ending stocks in the WASDE Report were estimated at 475 million bushels, down significantly from the 2018-19 ending stocks of 913 million bushels. The projected soybean ending stocks for the coming year are more similar to the carryout level of 438 million bushels for 2017-18. 

 

The soybean carryout-to-use ratio for 2019-20 is estimated at 11.5 percent, down considerably from 23 percent for 2018-19. Soybean demand for 2019-20 is projected to increase slightly, primarily due to a small increase in expected exports. The expected large decrease in soybean ending stocks may offer some opportunities for farm-level soybean prices in the coming months, especially if there is some resolution to the China trade situation.

 

USDA is currently estimating the U.S average on-farm cash corn price for 2019-2020 at an average of $3.85 per bushel, an increase of $.05 per bushel from the October estimate. The 2019-20 USDA price estimates are the expected average farm-level prices for the 2019 crop from September 1, 2019 to August 31, 2020. The projected USDA average corn price of $3.85 per bushel for 2019-2020 compares to national average corn prices of $3.61 per bushel for 2018-19.

 

USDA is projecting the U.S. average farm-level soybean price for the 2019-2020 marketing year at $9.00 per bushel, the same as October. That’s better than last year’s $8.48 per bushel, but well down from $9.35 per bushel for 2017-18.