Soybean yields remain in focus for the 2013 crop, while a massive jump in acres is now being estimated by many for the 2014 crop. In case you didn't see the data on Friday afternoon, Informa has its 2014 soybean acreage estimate at 83.6 million, some 6.4 million acres higher than the current 2013 USDA acreage estimate of 77.2 million acres. Needless to say this would be a NEW all-time record for U.S. soybean acres.
Lets also keep in mind this will come on the heels of a South American soybean crop that many analyst are saying could be a record as well. In fact, Argentina is thinking they will see a 6.5% reduction in corn acres next year and a big jump in bean acres. Brazil: same type of scenario, less corn and more beans.
From where I sit it seems a little to early to give a ton of credence to the U.S. numbers for 2014. My hunch is U.S. producers will be more apt to cut and sell soybeans directly out of the field this fall, while electing to hold their corn in hopes of higher prices. This lack of corn in the supply pipeline, coupled with the thought of a massive South American soy crop, might actually provide enough of a tailwind to snap the corn/bean ratio back to a more traditional level. If this ends up being the case, soybean acreage estimates here in the U.S. for 2014 will certainly need to come down. Lets not forget: U.S. farmers love to grow corn!
Near-term, the soy trade will continue to focus on U.S. yields and harvest updates. Even though early yields are coming in better than most had anticipated, the bulls are quick to point out late-planted areas that were more severely hit by the late summer "flash drought" have yet to harvest. On flip-side, the trade is wondering if late rains out west have helped add to the pod weights. China coming back from a brief vacation last week will also be in focus. The question is if and where they will be buying their beans (U.S., Argentina or Brazil)?