Record US corn yield casts bearish spell on markets

Chart U.S. soybean production

In its monthly supply and demand report, the USDA pegged the 2017 US harvest at a record 4.425 billion bushels, on a yield of 49.5 bushels per acre.

Corn carryover on September 1, 2018, was forecast at 2,487 million bus, up 147 million bus, or 6%, from October and up 8% from 2,295 million bus in 2017.

USA soybean production, meantime, was lowered slightly, from 4.431 billion bushels to 4.425 billion bushels. The yield will also be down from 2016 at 46 bushels per acre. "This year's record of 175.4 bu/ac reflects an approximate 20% increase in yield in just over 10 years", said Renewable Fuels Association President and CEO Bob Dinneen. If realized, corn production will be the second highest on record. The increase resulted from a 298-million-bu increase in forecast 2017 corn production, at 14,578 million bus, partially offset by a 75-million-bu increase in 2017-18 feed and residual use at 5,575 million bus, and a 75-million-bu increase in forecast exports at 1,925 million bus. The most recent USDA forecast calls for the state's farmers to harvest 187.96 million bushels this fall-up from last month's prediction of 184.15 million bushels. Last month the USDA predicted average yields in Colorado would be 145.0 bushels per acre, but that figure was increased to 148.0 this month. Argentina and Brazilian production was left "unchanged".

USA corn futures hit a one-year low on Thursday before edging higher on Friday.


"January futures are fighting to hold above the support line drawn off August-November lows, which comes in around $9.90, which is also right on the 25-day moving average", he says.

The USDA forecast the corn carryover of September 1, 2018, at 2,487 million bus. In turn, ending stocks are pushed higher from 2.340 billion to 2.487 billion bushels. Moreover, The USDA reported 1.16 mt of soybeans sold for export during the week of 11/2.

The next round of WASDE and Crop Production reports will be released on December 12.

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