The big round of reports USDA released on Aug. 12 created a lot more questions than answers. They also sent the markets lower. December corn prices were 37¢ lower for the week that ended Aug. 16. November soybeans were 13¢ lower and December wheat dropped 25¢.
Here’s a quick recap of the reports:
- USDA pegs corn production for grain at 13.9 billion bushels. That’s based on a national average corn yield of 169.5 bushels per acre, 82.0 million harvested acres and 90 million planted acres.
- Soybean production is forecast at 3.68 billion bushels. That’s based on a national average soybean yield of 48.5 bushels per acre, 75.9 million harvested acres and 76.7 million planted acres.
“The main shocker was USDA actually raised the corn yield,” says Jerry Gulke, president of the Gulke Group. “Many of us thought it would be lowered or stay the same at 166 bushels per acre. There's nothing out there that suggests the crop got better since the July report. Nevertheless, here we are.”
For these reports, Gulke says, USDA surveyed 13,000 farmers about the condition and expectations of their crops. Most farmers reported they had “good potential” as of mid-June, which is in part how USDA arrived at the 169-bushel-per-acre average
“I have to admit, I had some of the best-looking corn ever on some of my farms because it could take the rain, and some of the early-planted corn looked good,” Gulke says. “But I can’t tell you that corn will make it to fruition—even with a late frost.”
The Pro Farmer Midwest Crop Tour kicks off next week, with crop scouts taking hundreds of samples of corn and soybean fields in seven states. This year’s Tour will have unprecedented interest due to the unique 2019 crop year.
“In previous years, we’ve always had the government’s objective surveys out of the way ahead of the report, but this year we don’t,” Gulke says. “The government decided not to do them.”
As a result, this year’s Tour has the potential to have a major impact on the markets, Gulke says.
“It will provide the first objective yield that we've had,” he says.
Gulke will be speaking on Thursday, Aug. 22 at the IDEAg Dakotafest in Mitchell, S.D. Learn more about the event.
Find more written and audio commentary from Gulke at AgWeb.com/Gulke