The USDA Crop Report released on Sept. 11 increased the expected U.S. corn and soybean production for 2009, as compared to the August USDA estimates. USDA is now estimating the total 2009 corn production at 12.95 billion bushels, which is 2% above the 12.76-billion-bushel estimate in August. Total U.S. corn production in 2008 was 12.1 billion bushels. The USDA report is estimating total soybean production in 2009 at 3.24 billion bushels, which is slight increase compared to the 3.20-billion-bushel estimate in August. Total U.S. soybean production in 2008 was 2.96 billion bushels.
USDA is estimating that the 2009 average corn yield in the U.S. will be 161.9 bu./acre, which would be the highest U.S. average corn yield on record. The estimated September corn yield is an increase of 2.4 bu./acre over the August estimate, and is 8 bu./acre above the 2008 average corn yield. The increased U.S. corn yield expectations by USDA are due to very favorable weather conditions during August in the western Corn Belt and the northern Great Plains. The average U.S. soybean yield for 2009 is now estimated at 42.3 bu./acre, compared to a final average U.S. soybean yield of 39.6 bu. Soybean yield estimates for 2009 in the Sept. 11 report for the Upper Midwest remained very similar to the Aug. 1 yield estimates.
Based on the Sept. 11 report, USDA is estimating the 2009 corn yield in Minnesota at 167 bu./acre, which is the same as the August estimate, and is slightly above the 2008 average corn yield of 164 bu. The projected 2009 corn yield in Minnesota trails only the record average state corn yield of 174 bu./acre in 2005. USDA is estimating the 2009 average corn yield in Iowa to be the highest ever at 187 bu./acre, with the September estimate being increased by 2 bu. compared to the Aug. 1 estimate, and 16 bu. above the final 2008 average state corn yield. Illinois was plagued by late planting and very wet field conditions early in the 2009 growing season. However, conditions in Illinois have improved considerably later in the growing season, and USDA is now projecting the 2009 average corn yield at the same level as the 2008 average corn yield of 179 bu./acre, which represents an increase of 4 bu. compared to the Aug. 1 estimate.
USDA estimated the 2009 Minnesota soybean yield at 40 bu./acre in the latest Crop Report, which is the same as the Aug. 1 report, and is 2 bu. higher than the 2008 state average soybean yield. The projected 2009 yield in Iowa is unchanged from the Aug. 1 USDA estimate of 52 bu./acre, and compares to a final average yield of 46 bu./acre in Iowa in 2008. The estimated 2009 average soybean yield in Illinois is 44 bu./acre, which is 3 bu. lower than the state average yield in 2008.
Projected Carryover Stocks
USDA also released the latest estimates for 2009-2010 carryover stocks of corn, soybeans and other grains on Sept. 11. USDA is now estimating 2009-2010 U.S. corn carryover stocks at 1.635 billion bushels, which is a slight increase compared to the Aug. 1 carryover estimates, but is down slightly from expected 2008-2009 final corn carryover estimates. USDA is expecting 2009-2010 soybean ending stocks to be 220 million bushels, which is double the expected final 2008-2009 final soybean ending stocks of 110 million bushels.
Projected carryover stocks for corn and soybeans reflect expected 2009 crop production, as well as estimated grain usages for feed use, processing, renewable fuel production, exports and other uses. These projections are a very key fundamental in the movement of grain markets following harvest season. USDA is expecting the corn usage for feed, ethanol production and exports all to increase in 2009-2010, compared to 2008-2009, which is why corn ending stocks are expected to have a slight decline in 2009-2010, even with the expected larger U.S. corn production in 2009. Any major changes in the USDA projected corn usage levels could put pressure on the corn market in the coming months.
USDA is currently estimating the U.S average cash corn price for 2009-2010 in a range of $3.05 to $3.65/bu., or an average of $3.35. Final U.S. average corn price was estimated at $4.08/bu. for 2008-2009, and was $4.20 in 2007-2008. USDA is projecting the U.S. average soybean price for 2009-2010 in a range of $8.10 to $9.10/bu., resulting in an average soybean price of $8.60. Final U.S. average soybean price was estimated at $10/bu. for 2008-2009, and was $10.10 in 2007-2008.
Passing of Norman Borlaug
In a week when we are discussing near-record yields and crop production in the U.S., it is probably appropriate that we recognize the life and achievements of Norman Borlaug, who was a leader and pioneer in developing the prosperous crop production that we enjoy today. Borlaug is well known for his wheat research at the University of Minnesota that greatly enhanced worldwide wheat production, and for leading efforts in the U.S. and other countries to prevent famine and to fight global hunger. He received the Nobel Peace Prize in 1970, and two years ago he received the Congressional Gold Medal, which is the highest civilian honor awarded in the U.S. Borlaug passed away this past weekend at the age of 95, but his legacy will live on.
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.