USDA predicts record corn crop  

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The United States Department of Agriculture expects a big rebound for the American corn crop for 2020-21. According to its annual Outlook Forum, the USDA is calling for record production and domestic use, increased exports, and higher ending stocks.

The corn crop is projected at 15.5 billion bushels, 13 per cent above a year ago with an increase in area from last year’s weather-reduced plantings and a return to trend yields. The yield projection of 178.5 bushels per acre is based on a weather-adjusted trend assuming normal planting progress and summer growing season weather.

Despite beginning stocks forecast down from a year ago, total corn supplies at 17.4 billion bushels are forecast to be a record high.

Total U.S. corn use in 2020/21 is forecast to rise 5 per cent from a year ago on record domestic use and a rebound in exports. Food, seed, and industrial (FSI) use is projected up fractionally at 6.8 billion bushels, driven by slightly higher corn used for ethanol. Corn used for ethanol is up less than 1 per cent from a year ago, based on expectations of essentially flat motor gasoline consumption and a modest increase in exports. Feed and residual use is up 275 million bushels to 5.8 billion, with a larger crop, continued growth in grain consuming animal units, and lower expected prices.

Corn exports are up 375 million bushels to 2.1 billion, reflecting expectations of global trade growth but with continued competition from other exporters such as Argentina, Brazil, and Ukraine. Ending stocks are projected at 2.7 billion bushels, up 745 million from 2019/20, resulting in a 25 cent per bushel decline from a year ago in the season-average farm price to $3.60 per bushel.

The 2020/21 outlook for U.S. soybeans is for higher supplies, crush, and exports, and lower ending stocks. Soybean supplies are projected at 4.6 billion bushels, up 3 per cent from 2019/20 with higher production more than offsetting lower beginning stocks. Soybean production is projected at 4.2 billion bushels, 18 per cent above a year earlier with plantings recovering from last year’s weather-related decline and a return to trend yields. The yield forecast of 49.8 bushels per acre is based on a weather adjusted trend assuming normal growing season weather.

Soybean exports for 2020/21 are projected at 2.05 billion bushels, up 225 million from the 2019/20 forecast. Increasing global import demand, particularly for China, and a recovery in U.S. market share will support higher U.S. soybean exports following a sharp decline over the past two years.

Soybean ending stocks for 2020/21 are projected at 320 million bushels, down 105 million from 2019/20 and the lowest since 2016/17. With a 6 per cent increase in total soybean disappearance more than offsetting increased supplies, the ending stocks-to-use ratio is projected at 7.4 per cent, down from 10.5 per cent in 2019/20. With declining stocks, the soybean season-average farm price is projected at $8.80 per bushel, up only slightly from 2019/20. Prices, however, will remain pressured by increased South American production and export competition.

The 2020/21 outlook for U.S. wheat is for tighter supplies, slightly lower total use, and declining ending stocks. U.S. wheat production is projected down about 4 per cent from 2019/20 to 1.836 billion bushels on lower projected yield. All wheat planted area is down slightly, but the harvested area is up on a return to more normal harvested to planted ratio.

The National Agricultural Statistical Service Winter Wheat and Canola Seedings report indicates winter wheat seeded area down one per cent from 2019/20 and the lowest level in more than a century. Low winter wheat plantings are supporting spring wheat prices, but persistent wet soils and unharvested corn in the Northern Plains could prevent or delay some planting. The total wheat area for 2020/21 is projected at 45.0 million acres, down 158,000 acres from the previous year and a record low. The all wheat yield for 2020/21 is projected down nearly 7 per cent from last year’s near-record to 48.2 bushels per acre.

At 2.139 billion bushels, projected 2020/21 total use is down slightly from a year earlier but remains above the 5-year average. The year-over-year reduction stems from lower domestic use; exports are flat but still strong at 1.0 billion bushels. Forecast growth in global wheat demand supports the 2020/21 export forecast. Reduced U.S. supplies and relatively stable use lead to substantially lower ending stocks. At 777 million bushels, carryout for the 2020/21 marketing year is more than 17 per cent below the previous year and the lowest level since 2014/15. The tighter balance sheet supports a 2020/21 season-average farm price of $4.90 per bushel, up by $0.35 from the previous year.