12 July 2013 00:15 [Source: ICIS news]
HOUSTON (ICIS)--Recognising the lateness of the 2013 corn crop and the potential for lesser yields, the US Department of Agriculture (USDA) reduced the number of estimated harvested bushels by 55m in Thursday’s release of the July World Agricultural Supply and Demand Estimates (WASDE) report.
While the agency remains set in its estimate that 97.38m acres have been planted, the USDA said it expects only 89.1m acres (36.1ha) will eventually be harvested and that the yield forecast is calling for 156.5 bushels/acre. The agency said in the report the cut in corn production is a result of weather delaying spring plantings.
Initially, the USDA had estimated that US farmers would produce 163.6 bushels/acre. However, as a late winter and a rash of heavy showers kept field work to a minimal until mid-April, the agency reworked those figures and in May forecasted 158 bushels/bushel.
One of the biggest questions in terms of yields is whether summer temperatures will be too hot when the majority of the corn begins to pollinate and silk.
Extreme temperatures would limit kernel sets within the ears and sharply lower final harvest numbers, which was a scenario that occurred in 2012 as a widespread drought inflicted considerable losses.
The most recent weekly crop progress report stated 6% of the nation’s corn crop was already silking, compared with 46% in 2012 and slightly behind the five-year average of 20%. Additionally the crop progress update showed that 68% of the corn was being rated as being in good to excellent condition.
According to the July WASDE, the season average farm price for corn is $4.40-5.20/bushel, unchanged from the previous month.
Following the release of the WASDE report, there was a dip before the July contract climbed higher to close up 7 cents at $7.17/bushel.
For soybeans, the WASDE increased production by 30m bushels. However, for the second straight month, it left forecasted yields at 44.5 bushels/acre.
The USDA also left unchanged the estimate for soybean ending stocks at 125m bushels, despite export numbers running ahead of pace and some concerns about the health and eventual outcome of a late planted crop in many states.
In the weekly crop progress report, the agency said 95% of the crop has emerged compared with 100% in 2012 and the five-year average at 97%. The soybean rate of blooming was 10% versus 42% in 2012 and a five-year average of 24%.
Like its counterpart corn, the average farm price for soybeans was unchanged with the forecast remaining $9.75-11.75/bushel.
After initially posting some sell-off following the report release, July soybeans bounced back to close the day up 9.4 cents at $16.01/bushel.
The next WASDE report will be released on 12 August.
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