USDA Seen Lowering Crop Estimates Slightly

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USDA is expected to lower its estimates of U.S. corn and soybean production slightly further when it releases its November Crop Production Report on Wednesday.

Pre-report trade estimates of the U.S. corn crop average 12.402 billion bushels, 31 million bushels below USDA’s October estimate in a range from 12.159 billion to 12.549 billion bushels, according to a survey of 22 analysts done by Dow Jones Newswires.

Trade estimates of the U.S. soybean crop average 3.059 billion bushels, just 1 million bushels below USDA’s October estimate in a range from 2.975 billion to 3.110 billion bushels.

Pre-report expectations for the U.S. corn yield average 147.9 bu./acre in a range from 145.0 bu. to 149.5 bu. compared with USDA’s October estimate of 148.1 bu.

Trade forecasts of the U.S. soybean yield average 41.5 bu./acre unchanged from USDA’s October estimate, in a range from 40.4 bu. to 42.2 bu.

Brock Associates continues to anticipate modest increases in both corn and soybean production, based on better-than-expected yields reported in many parts of the western Corn Belt.

However, highly variable yield reports have made it difficult to get a good handle on this year’s production levels for both crops.

There are some indications the mid-September freeze in the northern Midwest may have done more damage to soybean yields there than was initially thought.

Recent history has been for November to bring a lower corn crop estimate. USDA has lowered its corn crop estimate in November in each of the past five years; however, it raised production in November in each of the five years before that.

USDA has lowered its soybean production estimate in November in three of the past four years, but prior to that, the agency raised production in November five times in six years.

Wednesday’s estimates will be the final monthly forecasts of corn and soybean production for the 2011 growing season. USDA will update its corn and soybean production figures again when it releases its Annual Crop Production Summary on Jan. 12, 2012.

Amid all of the uncertainty about the world economy caused by the ongoing debt crisis in Europe and lackluster U.S. economic performance, we expect grain traders to be paying more attention to USDA’s monthly supply/demand update, also due out Wednesday morning, which will contain its latest projections for corn and soybean demand.

 

Editor’s note: Richard Brock, Corn & Soybean Digest's marketing editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

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