February 28, 2005

US sees smaller corn, soy crops

US farmers will harvest smaller corn and soybean crops this year, after record production last year, the government said. The wheat harvest will also be reduced.

They will harvest 10.9 billion bushels of corn in 2005, down 7.6 per cent from last year's record crop of 11.8 billion bushels, said Keith Collins, the US Department of Agriculture's (USDA) chief economist, at the annual agriculture forum in Arlington, Virginia. Soybean production will be down 5.7 per cent and the wheat harvest will be reduced by 7.3 per cent, he said.

"The forecasts were pretty much as expected," said Sid Love, grain analyst for Kropf & Love Consulting in Overland Park, Kansas. "It will be June 30 before we know the actual size of the plantings, and summer weather can make a huge difference in final production."

The estimated corn and soybean crops, while smaller, would still be the second-biggest on record and provide ample supplies for Archer Daniel Midland Co, Bunge Ltd and other companies that process grain into vegetable oil, ethanol and animal feed.

The large crops may also help keep feed costs down for meat producers, such as Tyson Foods Inc and Smithfield Foods Inc.