The much-anticipated USDA August crop estimates might have short-lived market impact.
Ahead of the Aug. 10 Crop Production report, Reuters issued results of its survey, which showed analysts expected USDA to project the national average corn yield near 166.2 bushels per acre, for a crop of 13.855 billion bushels. Estimates ranged from 168.5 bu./acre to 162.8 bu./acre, for a crop of 14.07 to 13.59 billion bushels.
A Bloomberg survey found trade estimates for corn averaging 165.9 bu./acre and a crop of 13.81 billion bushels, and soybean yield averaging 47.4 bu./acre for a crop of 4.203 billion bushels.
The USDA has used trend yields of 170.7 bu./ acre of corn and 48 bu./acre of soybeans since its Agricultural Outlook Forum in February.
Before the USDA issued August estimates, some analysts explained why the numbers would be vague indicators at best.
“Just about everyone expects sub-trend yields, but the question is just how bad are the crops,” wrote Jack Scoville, of The Price Futures Group, in market commentary Aug. 7.
He said the Aug. 10 report would be based on a population survey and might not show the anticipated yield declines.
“Other measurements like ear length and weight that are used to determine overall yields will not really be measured for this month,” he said.
Weather has been generally a story of two extremes: Widely publicized hot and dry weather has gripped the western Corn Belt, and wet conditions have persisted in the eastern Corn Belt.
Parts of Indiana and Ohio were so wet that farmers replanted soybeans as many as four times, said Howard Keinath at The Andersons. In northwest Ohio and southeast Michigan, growing conditions had been favorable until rain stopped last month.
“Weather is getting to be an old story,” Keinath said. “I think we’ll continue to look at demand — which has been good.”
Ethanol demand is good and livestock numbers are up, so feed demand looks positive. And the export market has been good.
“It’s not a real pessimistic situation,” Keinath said.