The first U.S. corn crop to top 15 billion bushels would carry a $1.7 billion penalty of sorts for growers, according to USDA data, because of the lower average price expected for this year’s harvest. U.S. soybean farmers, forecast to reap the first crop exceeding 4 billion bushels, would see only a nominal decline in the value of their crop.
The record corn crop of 15.153 billion bushels would be worth $47.73 billion, and the record soybean crop of 4.060 billion bushels would be worth $39.95 billion, based on USDA estimates of the season-average price at the farm gate for the crops. For corn, that’s $1.7 billion, or 3 percent, less than the projected value a month ago for a smaller, but still record-large, crop. For soybeans, the value would be down by $66 million, or less than 1 percent.
The USDA forecast the bumper crops on the strength of a balmy growing season that will result in record yields per acre for corn and soybeans, with farmers harvesting the greatest number of soybean acres ever and the third-largest total for corn acres since World War II. If the USDA’s estimates prove true, the corn crop would be 6.6 percent larger than the 2014 record of 14.216 billion bushels, and the soybean crop would be 3.5 percent larger than the mark of 3.929 billion bushels set last year.
The 2016 crops would continue a trend of record-breaking harvests. Soybean growers are headed for the third record-setting crop in a row, and corn growers would set a record for the third time in four years. “Nearly all Corn Belt states, with the exception of Minnesota and South Dakota, are forecast to have yields above a year ago,” said the USDA, referring to the corn crop.
With the mammoth harvests, U.S. supplies are at all-time highs, while commodity prices are in a slump that began in 2013. This year’s corn crop is forecast to fetch the lowest average price in a decade, while soybeans would see the second-lowest price in 10 years.
Along with record-setting corn and soybean crops, the USDA forecast a record-large U.S. rice crop of 7.76 million tonnes (244.3 million hundredweight). The crop is expected to sell for an average of $10.90 per 100 pounds, down 90 cents from the USDA estimate a month ago.
Worldwide, wheat, corn, rice and soybean production would also reach record levels, said the USDA. The U.S. wheat crop is forecast for 2.321 billion bushels, up 60 million bushels from an estimate made a month ago, for a slightly larger crop than usual. Unrelenting summer rains damaged wheat quality in France and will bring the lowest yields per hectare in 30 years. But Russia, Ukraine and Kazakhstan had excellent growing weather and high yields.