September 12, 2014

USDA forecasts record high corn output in US but big drop in China

The US Department of Agriculture predicts a record high US corn production but significant shortfalls in other major corn-producing countries like China, Argentina, Ukraine and Russiafor 2014/15.

US Agriculture Secretary Joseph W. Glauber and Agricultural Statistics Board chair James M. Harris said in this month's crop production report releasedThursday that US corn output for market year 2014/15 is forecast at 14.4 million bushels, up 3% from both the August forecast and from 2013.

In the case of soy, production for 2014/15 is forecast at a record 3.91 billion bushels, up 3% from August and up 19% from last year.

Based on conditions as of September 1, Glauber and Harris said in their joint report, corn "yields are expected to average 171.7 bushels per acre, up 4.3 bushels from the August forecast and 12.9 bushels above the 2013 average."

"If realized, this will be the highest yield and production on record for the United States," they said. Area harvested for corn is forecast at 83.8 million acres, unchanged from the August forecast but down 4% from 2013.

Soy yields, meanwhile, are expected to average a record high 46.6 bushels per acre, up 1.2 bushels from last month and up 3.3 bushels from last year. Area for harvest in the US is forecast at a record 84.1 million acres, unchanged from August but up 11% from last year, Glauber and Harris added.

A World Agricultural Supply and Demand Estimates (WASDE) report, which the USDA also released September 11, expects China's corn output for 2014/15 to drop5 million tonnes "based on persistent summer dryness in key growing areas of the North China Plain and the Northeast."

Estimate for Argentina's corn production is lowered 3.0 million tonnes for the same period with lower expected plantings. Hot and dry conditions in Ukraine and Russia are seen to reduce the two countries 2014/15 corn production prospects by 1.0 and 0.5 million tonnes, respectively.

US corn exports are projected 25 million bushels higher than last year's "with lower prices and reduced competition expected from South America later in the marketing year," the WASDE report said.

The report also lowered 40 US cents at the midpoint to US$3.20 to US$3.80 per bushel the season-average farm price for corn in 2014/15.