CHICAGO – The US Agriculture Department lowered its corn harvest outlook as cold and wet conditions late in the growing season cut into yields in key production areas such as South Dakota, Nebraska and Minnesota.
USDA also lowered its outlook for wheat production but left its soybean harvest view unchanged after what has been a complicated growing season for farmers wrestling with falling income due to a trade war with China in addition to poor weather.
“The reduction in (corn) yield is a confirmation of the problems we’ve been having,” said Bob Utterback, president of Utterback Marketing. “I think you’ll continue to see the yield still show signs of stress going into the January report.”
The government forecast US corn production of 13.661 billion bushels, based on an average yield of 167.0 bushels per acre, in its monthly World Agricultural Supply and Demand Estimates report.
Chicago Board of Trade corn futures, which had been trading in negative territory for much of the morning, turned higher after the report was released online.
Lance Honig, crops chief at the USDA’s National Agricultural Statistics Service, wrote on Twitter that staff were investigating technical issues that delayed publication of the report by several minutes.
The soybean harvest was pegged at 3.550 billion bushels, with yields seen at 46.9 bushels per acre. The USDA lowered its forecast of wheat production to 1.920 billion bushels from 1.962 billion bushels.
Analysts had been expecting US corn production to fall to 13.643 billion bushels, based on an average yield of 167.5 bushels per acre, and soybean production to fall to 3.510 billion bushels, based on an average yield of 46.6 bushels per acre, according to the average of estimates in a Reuters poll.
In October, the USDA forecast corn production of 13.779 billion bushels on yields of 168.4 bushels per acre.
The 2019/20 ending stocks outlook for corn was cut to 1.910 billion bushels from 1.929 billion bushels. The USDA lowered usage in the ethanol and feed and residual sectors by 25 million bushels each. Corn exports were cut by 50 million bushels.
“We simply need corn demand to pick up,” said Karl Setzer, commodity risk analyst for AgriVisor. “If our corn sales were any worse, they’d be bringing it back to us.”
Analysts had forecast corn ending stocks of 1.817 billion bushels.
Soybean ending stocks were raised by 15 million bushels to 475 million bushels, topping market forecasts for 428 million. – Reuters