Last week, USDA officials released their latest agricultural supply and demand and crop production estimates.

In the August World Agricultural Supply and Demand (WASDE) report, USDA forecasted an average U.S. corn yield of 123.4 bushels per acre – 22.6 fewer bushels than July’s estimate and 23.8 bushels below last year.

The corn harvested acreage estimate was 87.4 million acres, 3.4 million acres more than last year. The reduction in yields resulted in a total U.S. corn production forecast of 10.8 billion bushels, the smallest since 2006.

The reduction in yields did not offset the slight increase in harvested acres resulting in a total U.S. soybean production forecast of 2.7 billion bushels, 364 million less than the prior year.

Even with USDA’s reduction in usage estimates for corn and soybeans due to higher prices, the decline in the drought impacted production outpaced the decrease in demand. The resulting ending stocks of corn and soybeans are forecasted to decline compared to the prior year by 371 million and 30 million bushels, respectively.

The reduction in ending stocks prompted an increase in USDA’s forecasted prices for this year’s crop.

The estimated average price of corn is $8.20 per bushel, $1.95 per bushel higher than last year. USDA forecasted soybean prices would average $16 per bushel, $3.55 above last year.  PD

—From DFA Today