USDA CROP REPORT – CORN
The USDA Crop Report issued on August 12 came in with a larger than expected crop production estimate for the 2005 corn crop in the U.S., but a much lower total production estimate than the record corn production in 2004. USDA estimated the 2005 corn crop at 10.350 billion bushels, which is down from 10.785 billion bushels in July. The August estimate is slightly higher than most private analysts estimated. USDA is projecting a national average corn yield of 139.2 bu./acre, which is down considerably from the record average yield of 160.4 bu./acre in 2004. The significant projected yield reductions and corn production decreases in the August report were largely due to continued drought in parts of Southern Iowa, Illinois, Missouri, Michigan and Southern Wisconsin. Certainly, continuation of the hot, dry weather pattern could result in expansion of the drought area in the Midwest, and result in further yield reductions. Much of Minnesota and Northern Iowa have good to excellent yield prospects for the 2005 corn crop. The higher than expected corn estimate has had an impact on corn prices on the Chicago Board of Trade (CBOT) and local market bids. CBOT corn bids foe “new crop” corn closed down 7 cents after the Crop Report was released on August 12.
The USDA Soybean Report on August 12 was down only slightly from the July crop production estimate. USDA now projects the 2005 U.S. soybean crop at 2.791 billion bushels, which compares to a record total U.S. soybean production of 3.141 billion bushels in 2004. The USDA August soybean estimates are slightly below trade expectations. The projected lower U.S. soybean production for 2005 is a combination of reduced yields in some areas due to drought conditions, and a reduction of 1.7 million acres planted to soybeans in 2005 compared to 2004. The lower 2005 production estimate, combined with fairly tight inventory of soybean stocks nationwide, have helped soybean prices stay fairly strong later into the growing season. New crop soybean bid price at Lake Crystal on August 12 was at $6.97/bu., which was $.54/bu. higher than the day of the August USDA Crop Report in 2004.
Editors note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at [email protected].