As expected, USDA on Friday lowered both corn and soybean yields and production, dropping corn yields to 175.1 bushels per acre (bpa), and lowering soybean yields to 50.9 bpa.
Corn production was pegged at 15.11 billion bushels (bb), and soybean production was forecast at 4.2 billion bushels.
Farm Director KC Sheperd had the chance to visit with Allendale’s Rich Nelson after the Report. He said there were some interesting discussions around the Wheat number, “USDA did both a resurvey effort for acreage for small grains and really for wheat that didn’t change the story too much, only 180,000 acres that was offset by yield decline 0.3 bushels an acre. So production in this case was lowered by 5 million bushels, not a big surprise there.”
Nelson said USDA did address some export concerns, and therefore stocks are raised by 592 to now 615, but said that was the standard trade expectation. However, Nelson did say on the Hard Red Winter side, we saw some pretty big numbers, “We will point out that numbers were raised, and a lot of us might wonder with active harvest what type of discussion that would have been here in prior weeks. But our discussion now is that we’re wrapping up our argument here that perhaps this hard red did relatively well considering our weather challenges earlier this year. So overall, some stout numbers but not too out of balance here.”
Regarding the livestock numbers, Nelson said those discussions were also interesting, “That was a really interesting discussion, especially on the cattle side. As a primer, remember the last month we’ve been discussing the idea that USDAs prior views on 2024 beef production were pretty out there, so to speak, they were suggesting a 9% cut in next year’s beef production, and most of us on the private side are at maybe a 4 or 5% cut for next year. So even though USDA did raise their beef production number for next year, stout 465 million pounds, it’s still not really that much of a bearish argument. They’re still suggesting the 7% cut.”
To read more from Rich Nelson at Allendale, click here:
You can also access the full reports here:
— Crop Production: https://www.nass.usda.gov/…
— World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…
WHEAT
USDA estimates U.S. wheat production at 1.734 billion bushels, a decrease from 1.739 bb in the July report.
USDA puts ending stocks for 2023-2024 wheat at 615 million bushels, an increase from 592 mb in July.
Wheat farm-gate prices were left unchanged at $7.50 per bushel.
Globally, USDA decreased ending stocks to 265.61 million metric tons from 266.53 mmt in July.
Beginning stocks decreased to 268.31 mmt, production fell to 793.37 mmt.
India’s production is estimated at 113.50 mmt, unchanged from July. India exports were estimated at 1 mmt, unchanged from July.
USDA estimates China production at 137.0 mmt, a decrease from 140 mmt in July. Chinese exports are estimated at 900,000 mmt, unchanged from July.
USDA estimates production in Ukraine at 21.0 mmt, with exports at 10.5 mmt.
Russia production is estimated at 85.0 mmt, unchanged from July. Russian exports were estimated at 48.0 mmt.
All wheat production for grain is forecast at 1.73 billion bushels, down less than 1% percent from the previous forecast but up 5% from 2022.
Based on Aug. 1 conditions, yields are expected to average 45.8 bushels per harvested acre, down 0.3 bushel from the previous forecast and down 0.7 bushels from 2022. Area harvested for grain is forecast at 37.9 million acres, up less than 1% from the previous forecast and up 7% from 2022.
Winter wheat production is forecast at 1.23 billion bushels, up 2% from the July 1 forecast and up 11% from 2022. As of Aug. 1, the United States yield is forecast at 48.1 bushels per acre, up 1.2 bushels from last month and up 1.1 bushels from last year’s average yield of 47.0 bushels per acre. Area expected to be harvested for grain or seed totals 25.5 million acres, down 1% from the acreage report released on June 30, 2023, but up 9% from last year.
Hard red winter production, at 585 million bushels, is up 1% from last month. Soft red winter, at 440 million bushels, is up 4% from the July forecast. White winter, at 202 million bushels, is down 2% from last month. Of the White winter production, 11.9 million bushels are hard white and 190 million bushels are soft white.
Durum wheat production is forecast at 57.4 million bushels, up 6% from the previous forecast but down 10% from 2022. Based on Aug. 1 conditions, yields are expected to average 35.5 bushels per harvested acre, down 2.4 bushels from the previous forecast and down 5.0 bushels from 2022.
Area expected to be harvested for grain or seed totals 1.62 million acres, up 13% from the acreage report released on June 30, 2023, and up 2% from 2022.
Other spring wheat production for grain is forecast at 450 million bushels, down 6% from the previous forecast and down 7% from last year. Based on Aug. 1 conditions, yields are expected to average 41.8 bushels per harvested acre, down 3.4 bushels from the previous forecast and down 4.4 bushel from 2022.
Area harvested for grain or seed is expected to total 10.8 million acres, up 2% from the acreage report released on June 30, 2023, and up 3% from 2022. Of the total production, 413 million bushels are hard red spring wheat, down 7% from 2022.
CORN
USDA continued lowering its 2023-24 yield estimates, dropping it to 175.1 bpa, down 2.4 bpa from the July forecast. Production for the 2023-24 corn crop was also lowered to 15.11 billion bushels, down 209 million bushels (mb) from last month.
Both the yield and production declines came in lower than the average pre-report estimates from analysts.
USDA actually bumped up old-crop ending stocks by 55 million bushels, essentially increasing new-crop beginning stocks to 1.457 billion bushels.
New-crop ending stocks were lowered 60 million bushels to 2.202 billion bushels.
On the demand side, USDA projects the 2023-24 food, seed and industrial use at 6.715 bb, down 20 mb from last month. Ethanol use was held at 5.3 billion bushels. Total domestic use is forecast at 12.340 bb, down 45 mb.
Exports for the new crop were lowered 50 mb to 2.05 bb.
The farmgate price for the 2023-24 crop is projected at $4.90 a bushel, a 10-cent bump from last month.
Globally, beginning stocks for the 2023-24 new crop were increased 1.62 million metric tons (mmt) to 297.92 mmt. Production globally was lowered 10.97 mmt to 1,1213.5 mmt. Global exports were lowered by 2.07 mmt to 196.19 mmt. Global ending stocks for the new crop are forecast at 311.05 mmt, down 3.07 mmt.
Ukraine’s production was increased 2.5 mmt to 27.5 mmt and despite the shutdown of the Black Sea ports, Ukraine’s exports were held steady at 19.5 mmt.
Looking at global 2022-23 crop, Brazil’s production was bumped up 2 mmt to 135 mmt and exports held pat at 56 mmt. Argentina’s production was held at 34 mmt and Argentina’s exports were held pat at 22 mmt as well.
SOYBEANS
USDA lowered its soybean yield estimate to 50.9 bushels per acre, 1.1 bushels less than last month, within the range of pre-report expectations. That lowers production to 4.205 billion bushels.
USDA raised beginning stocks for the 2023-24 season by 5 million bushels. The result was overall supply of 4.496 bb, 79 mb lower than last month’s estimate. On the demand side, USDA lowered exports by 25 mb, dropping total use correspondingly. The net result was a 55-mb decline in ending stocks to 245 mb, which was also within the range of pre-report estimates.
The national average farm gate price increased 30 cents to $12.70 per bushel.
Globally, USDA’s forecast for 2023-24 ending stocks for soybeans declined by 1.6 million metric tons to 119 mmt “mainly on lower U.S. stocks,” USDA said.
For the old-crop 2022-23 year, USDA raised global ending stocks to 103.1 mmt, toward the high end of pre-report expectation.
