With U.S. corn production forecast at a record 14 billion bushels, growers can expect to see futures prices stay above $4 per bushel for the time being, an expert from Ohio State University’s College of Food, Agricultural, and Environmental Sciences said.
The U.S. Department of Agriculture said in its crop production report today (Nov. 8) that farmers will produce a record 14 billion bushels of corn per acre, an increase of 1 percent from the projected 13.843 billion bushels per acre USDA forecast in its September report. The results are an increase of 30 percent from 2012, USDA said, noting that “if realized, this will be a new record production for the United States.”
Yields are expected to average 160.4 bushels per acre, an increase of 5.1 bushels from the USDA’s September forecast, the federal agency said. Area harvested for grain is forecast at 87.2 million acres, down 2 percent from the previous forecast and down slightly from 2012, it said.
Matt Roberts, an Ohio State University Extension economist, called the report “mildly bullish,” noting that “the combination of higher yields and acreage cuts have left the total corn harvest about where the market expected it to be.”
OSU Extension is the outreach arm of the college.
“What we saw was demand with lower prices over the last 4 to 6 weeks has increased consumption of U.S. corn,” Roberts said. “Export sales have increased, and the net result is that there’s only a very small increase in ending inventory.
“The high consumption number offset the higher demand number, resulting in a more positive result than people feared coming into the report.”
Despite the fact that many growers throughout Ohio and the Midwest planted corn and soybeans later this year because of colder weather in the spring, stronger rainfall coupled with hot, dry weather in September and early October helped Ohio and Midwest growers produce the record crops, he said.
This after the worst drought in nearly 50 years drastically cut corn and soybean yields last year, resulting in huge losses for many growers nationwide.
In Ohio, the USDA estimates 3.63 million acres of corn will be harvested, down from 3.65 million in 2012. Yield is expected to average 174 bushels per acre, sharply up from 123 bushels last year. Total corn production is an estimated 631.6 million bushels, up from 448.9 million in 2012, USDA said.
Farmers can expect to see “future prices stay above $4 per bushel for corn and cash prices stay at around $4 a bushel,” Roberts said. “Growers would like to see higher prices, and based on September expectations, we thought we’d have higher prices based on the weather pattern over the summer.
“So prices are slightly disappointing. But Ohio farmers had a pretty good year, with the vast majority of farmers producing good yields with high outputs. So the net result for most growers should be positive.”
Soybean production is forecast at 3.26 billion bushels, up 3 percent from the previous forecast and up 7 percent from last year, USDA said.
“If realized, production will be the third largest on record,” USDA said in a statement. “Based on Nov. 1 conditions, yields are expected to average 43 bushels per acre, up 1.8 bushels from the previous forecast and up 3.2 bushels from 2012.
“Area for harvest in the U.S. is forecast at 75.7 million acres, down 1 percent from both the previous forecast and last year.”
USDA estimates that Ohio soybean acres harvested will be 4.43 million acres, down from last year’s 4.59 million. Average yield is an estimated 49 bushels per acre. Total Ohio soybean production is forecast at 217 million bushels, up from 206.5 million in 2012, USDA said.
Friday’s USDA report is seen as taking on more significance as it was the first report since the government re-opened after a partial shutdown in October that resulted in a halt to USDA data. The federal agency canceled its October crop report as a result.