The USDA surprised analysts in this month's Supply and Demand Report with a decrease in corn yield and production. During the critical corn pollination period weather has been favorable over the majority of the Corn Belt giving analysts a reason to believe that yields, production and stocks would travel in the other direction. One could argue the large gap between analysts and the USDA was in part due to the first survey based yield estimate of the year.
U.S. corn production for 2013/14 was estimated 187 million bushels lower, to 13.8 billion bushels. The first survey based corn yield forecast for 2013/14 lowered yields from 156.5 bushels per acre in July to 154.4 bushels per acre this month. U.S. ending stocks for 2013/14 were lowered by 50 million bushels, to 1,837 million, due to the decrease in average yield. The stocks to use ratio was estimated at 14.5%.
U.S. exports for 2013/14 were estimated at 1,225 million bushels, a 25 million bushel decrease due to increased global competition and decreased domestic supply. The season average corn price for 2013/14 was increased 10 cents at both ends of the range to $4.50 to $5.30.
Global corn production for 2013/14 was decreased by 2.7 million tons as decreased production in the U.S., Mexico, European Union, Russia and Serbia is expected.
U.S. average soybean yields in 2013/14 were decreased by 1.9 bushels per acre from last month, to 42.6 bushels. Harvested acreage was decreased 0.5 million acres to 76.4 million acres. Production for the 2013/14 year was decreased by 165 million bushels to 3.255 billion bushels due mainly in part of lowered harvested acres and a decrease in average yield.
Ending stocks for soybeans in the 2013/14 marketing year were lowered by 75 million bushels, to 220 million. Exports were also lowered, by 65 million bushels, due to reduced supplies and increased prices. The projected season average price range for 2013/14 was $10.35 to $12.35 per bushel, an increase of 60 cents on both ends of the range.
U.S. wheat exports for 2013/14 were projected 25 million bushels higher due to strong seasonal sales and a positive outlook for Chinese imports. Ending stocks for 2013/14 were lowered from 576 million bushels to 551 million. The season average wheat price for 2013/14 was estimated at $6.40 to $7.60 per bushel, a decrease of 10 cents a bushel at the midpoint.
Global wheat supplies for 2013/14 were increased by 7.5 million tons due to record production from some of the world's largest exporters. It is estimated that world production of wheat will produce a record 705.4 million tons.
Over the next month, weather will play a key role in the development of soybeans. We will continue to monitor the weather and scout the Corn Belt for more information on the growing season.
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