Bumper Crop: Soybeans and corn see high yields

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The Aug. 10 Crop Production report forecast the 2017 US average corn yield at 169.5 bushels per acre and total corn production at 14.153 billion bushels, which would be the third-highest on record.

Soybean yields are expected to average 49.4 bushels per acre, down 2.7 bushels from last year, while the average corn yield is forecast at 169.5 bushels per acre, down 5.1 bushels from last year. Up 7 percent from a year ago, area for soybean harvest is forecast at a record 88.7 million acres with planted area for the nation estimated at a record-high 89.5 million acres, unchanged from the June estimate. For soybeans, year-over-year changes in soybeans yields in the High Plains reached -20 percent, and in the "I-States", yield declines are projected to be -2 to -7 percent lower, Figure 3.

Still, some expressed skepticism over the figures, which would produce a record soybean harvest of almost 4.4 billion bushels and a formidably large corn bounty of 14.2 billion bushels.

According to the USDA, if realized this will be the third highest yield and production on record. Additional production is expected to result in increased exports from Russian Federation, the Ukraine, and Kazakhstan and reduced demand for US hard red winter wheat.

The CBOT reported five soybean deliveries, 138 soymeal deliveries and 70 soyoil deliveries against August futures, which expire next week. In July, USDA forecast a corn harvest of 14.255 billion bushels and a yield of 170.7 bpa.

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December milling wheat, the most active contract on the Paris-based Euronext exchange, settled 1.75 euros, or 1.1 percent, lower at 165.50 euros ($195.60) a tonne. "For the four weeks remaining in the marketing year, export inspections need to average 15.7 million bushels per week to meet the USDA projection", Hubbs said. Trade estimates for soybeans pointed to 4.212 billion bushels, with an average crop yield of 47.5 bushels per acre. In the latest poll by Reuters, the average trade guess is for corn yield to be reduced to 166.2 BPA from 170.7 in the July report. Yield is estimated at 171 bushels per acre, up 12 bushels from the 2016 level. These areas with worse crop conditions (red shaded states) in 2017 represent 84 percent of the corn production in 2016. Following the report, new-crop soybean futures declined by 3 percent, or 27 cents, to $9.50 per bushel.

Corn on Thursday hit its lowest since June 30 at $3.70-1/4 a bushel.

With the 2017/18 crop still in the ground, a significant amount of uncertainty remains.

This WASDE's estimate of world wheat production and ending stocks may kill the hope for significantly higher prices between now and July 2018.

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