USDA revises corn production down further on drought damage

USDA revises corn production down further on drought damage

Average yields are now expected to be the lowest since 1995, with prices reaching as high as $8.90 per bushel.

U.S. corn production is forecast at 10.8 billion bushels, down 13 percent from 2011 and the lowest production since 2006 as conditions continue to worsen due to drought, according to the USDA’s latest report.

Based on conditions as of August 1, yields are expected to average 123.4 bushels per acre, down 23.8 bushels from 2011. If realized, this will be the lowest average yield since 1995. Area harvested for grain is forecast at 87.4 million acres, down 2 percent from the June forecast but up 4 percent from 2011. 

August 13 webinar to address crop report  

In a webinar August 13, Tim Brusnahan, Richard A. Brock & Associates, and Chris Hurt, Purdue University, will analyze and discuss the August crop report. 

There is still time to sign up for the webinar, sponsored by Pfizer Animal Health Global Poultry and part of the 2012 WattAgNet Webinar Series. 

Following their presentations, Brusnahan and Hurt will answer questions posed by the moderator and the live webinar audience.

Learn more about this webinar and sign up to attend: http://www.wattagnet.com/More_Info_webinar.aspx?taxonomyid=6898&menuparentId=6897&id=153491 

Corn prices continue to soar  

Corn prices, which reached record levels above $8 per bushel in July, could go as high as $8.90 per bushel, far above the initial $4.80 per bushel projected in April at planting time. On the Chicago Board of Trade, corn futures sold for $8.43 a bushel shortly after the report was issued on Aug. 10, as traders already factored lower production into their numbers.

Soybean production has also been reduced, to 2.69 billion bushels, down 12 percent from 2011 numbers. Based on August 1 conditions, yields are expected to average 36.1 bushels per acre, down 5.4 bushels from 2011. If realized, the average yield will be the lowest since 2003, according to the USDA. Area for harvest is forecast at 74.6 million acres, down 1 percent from June but up 1 percent from 2011.

Surplus corn stocks going into 2013 are projected at 650 million bushels, down significantly from 1.18 billion bushels forecast in July and the smallest carryout since 1995–1996. Global corn ending stocks are also estimated down, at 123.33 million metric tons compared to the 134.09 metric tons forecast by the USDA in July. Total corn use is projected 1.5 billion bushels lower, and at 11.2 billion would be a six-year low. The biggest reduction is for feed and residual disappearance, projected down 725 million bushels. Feed grain supplies will be 2.2 billion bushels lower than earlier projections, as livestock producers reduce their herds due to higher feed costs.