Home Indiana Agriculture News Corn and Soybean Production Up from September Forecast

Corn and Soybean Production Up from September Forecast

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The highly anticipated USDA production and supply and demand reports released Friday did move the futures markets, and notably corn futures shortly after the release went ten cents higher. That jump didn’t last long though as traders, like Tom Fritz at EFG Group realized it really wasn’t a bullish report for the corn market.

“If you look at U.S. numbers, ya, it’s a friendly report. Harvested acres come in much lower than expected so your carryout only increases by 32 million bushels. The kicker here is world production. World carryout jumps by nearly 13 million tons. You’re not going anywhere with that type of number. Sure we had a friendly reaction to the U.S. numbers but the global numbers are just too overbearing.”

The big mover Friday was the soybean market despite USDA issuing higher numbers than the average analyst estimates.

“Yield comes in a little bit higher than expected, harvested acres a little bit lower than expected, your carryout jumps 20 million bushels. Looking at the bean report domestic numbers and the world numbers, it would suggest beans are appropriately priced where they are right now.”

But in the end it was a strong day for soybeans because of a 710,000 acre drop in harvested acres. The new harvested acres total was established as 75.668 million acres, lower than the previous 76.378 million acres.

December corn ended the day up 6 ¼ to $4.26 ¾ and January soybeans went up almost 30 cents to $12.96.

From USDA:

Corn production is forecast at 14.0 billion bushels, up 1 percent from the previous forecast and up 30 percent from 2012. If realized, this will be a new record production for the United States. Based on conditions as of November 1, yields are expected to average 160.4 bushels per acre, up 5.1 bushels from the previous forecast and 37.0 bushels above the 2012 average. If realized, this will be the highest average yield since 2009. Area harvested for grain is forecast at 87.2 million acres, down 2 percent from the previous forecast and down slightly from 2012.

Soybean production is forecast at 3.26 billion bushels, up 3 percent from the previous forecast and up 7 percent from last year. If realized, production will be the third largest on record. Based on November 1 conditions, yields are expected to average 43.0 bushels per acre, up 1.8 bushels from the previous forecast and up 3.2 bushels from 2012. Area for harvest in the United States is forecast at 75.7 million acres, down 1 percent from both the previous forecast and last year.

Source: NASS (click here for the full report)

Click here for the November WASDE report.

After the report Tom Fritz of EFG Group and Bob Utterback of Utterback Marketing Services reacted to the reports:Fritz-Utterback