USDA is quite optimistic about the 2010 corn and soybean crop, especially crop yields in the Upper Midwest. Crop conditions continue to be quite favorable across Minnesota and in other states in the northern edge of the Corn Belt. There is more concern with hotter, drier weather in some portions of the southern Corn Belt and Great Plains States. There is also some concern that the extreme heat may have advanced the corn development too quickly, which may lead to some yield reduction in some areas.
Corn and soybean markets have continued to trend upward since the Aug. 12 USDA WASDE report was released. However, most of the strength in the grain markets has been due to strong demand, and is not related to the 2010 production estimates. The grain markets have been quite volatile in recent weeks, and are likely to remain that way through harvest, given some of the uncertainty surrounding the 2010 crop conditions, and the very high yield estimates for northern states.
Corn
The USDA WASDE Report issued on Aug. 12 came in with a larger-than-expected crop production estimate for the 2010 corn crop in the U.S., which would make it the largest U.S. corn crop in history – above the record 2009 total corn production of 13.1 billion bushels. Based on Aug. 1 conditions, USDA is estimating the 2010 corn crop at almost 13.4 billion bushels an increase of about 2% above the 2009 U.S. corn production, and 11% above the 2008 total U.S. corn production of 12.1 billion bushels. Total harvested corn acreage in the U.S. for 2010 is estimated at 81 million acres, compared to 79.5 million acres in 2009. The U.S. corn carryover for 2009-2010 is now estimated at 1.6 billion bushels, which is up slightly from the July USDA estimate.
USDA is now projecting a national average corn yield of 165 bu./acre, which is just above the record U.S. corn yield of 164.7 bu. in 2009. The projected yield increase compared to 2009 is due to greatly improved weather conditions in the Upper Midwest, with Minnesota having over 90% of the corn rated good to excellent in early August. USDA pegs Minnesota’s average 2010 corn yield at a record level of 178 bu./acre, which compares to an average corn yield of 174 bu. in 2009. USDA is now projecting Iowa’s average corn yield at 179 bu./acre for 2010, down slightly compared to the 2009 average of 182 bu.. The 2010 USDA corn yield estimates for the other major corn-producing states are: Illinois at 180 bu., Indiana at 176 bu. and Nebraska at 180 bu.
The USDA Report on Aug. 12 is projecting a record level of soybean production in the U.S. in 2010. USDA is estimating 2010 total soybean production at 3.43 billion bushels in the U.S., which is approximately 2% above the 2009 national soybean production. USDA now projects that soybean ending stocks for 2010-2011 will decline compared to the current year, due to expected increases in the soybean crush and stronger export demand.
The U.S. average soybean yield for 2010 is estimated at 44 bu./acre, which matches the record U.S. soybean yield of 44 bu. in 2009. Soybean yields in 2010 are expected to increase by 4 bu. or more in several northern tier states, including Minnesota, Wisconsin and North Dakota.
Editor’s 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 kent.thiesse@minnstarbank.com.