For use in local newspapers, week of September 15, 2014:
It will be the largest crop on record in the U.S. if everything the USDA’s September Supply and Demand Report holds true.
The report for the 2014-2015 marketing year confirms that U.S. grain producers can expect record yields and low market returns. Yield estimates for both corn and soybeans are even higher than anticipated, with corn at 171.7 bushels per acre and soybeans coming in at 46.6 bushels per acre.
Although projected usage is also looking higher to help absorb the excess supply, prices are still expected to be the lowest since 2009-2010, Farm Bureau Deputy Chief Economist John Anderson said.
“With a price forecast mid-point of $3.50 for corn, we’re looking at the lowest marketing year average price since 2006-07,” Anderson said. “And it is unlikely these prices will improve as the season’s projected carryover is at 2.002 billion bushels, the largest carryover since the 2004-05 marketing year.”
Carryover for soybeans is also expected to increase from a record low 130 million bushels at the end of 2013-14 to 475 million bushels, the largest since 2006-07. Greg Fox, a grain marketing specialist with the Louisiana Farm Bureau said the soybean market closed lower than $10 per bushel for the first time in years following the report.
“Not a lot of good news for the farmers with these markets right now,” Fox said. “We were already expecting a big production and you can see an almost four billion bushel crop out of this soybean acreage. That's what's killing our markets right now and will continue to kill our markets for the foreseeable future.”
Global production continues to reach record highs as well—soybean production at 311.13 million metric tons and carryout at more than 90 MMT, both records. Global wheat production is also expected to reach a record level of 720 MMT.