Traders expect USDA to forecast record crops today – 14.25 billion bushels of corn and 3.82 billion bushels of soybeans – in its first estimate of the fall harvest only a few weeks away. The August crop report is based on interviews of 24,000 producers and first-hand inspection of fields nationwide during the last week of July and first week of August. The forecasts will influence futures prices. And given the U.S. position as one of the leading agricultural producers and exporters in the world, they will affect estimates of global grain supplies.
There is sizable leeway in USDA’s estimates, given the uncertainties of crops not yet mature. USDA assigns a margin of error of 10.4 percent for its corn estimate and 11.8 percent for soybeans.
Analysts expect that record-setting crop will fatten U.S. stockpiles. In a survey, they said the corn stockpile at the end of the 2014/15 marketing year on Sept 1 would be 2 billion bushels, largest in a decade, and soybeans would be the largest in eight years at 414 million bushels. USDA says its August estimate of ending stocks 12 months in the future has a margin of 50.5 percent for U.S. feed grains and 78 percent for soybeans.
The U.S. corn and soybean crops are in stellar conditions as they turn towards maturity, says the weekly Crop Progress report. Some 73 percent of corn rates as good or excellent, the best mid-August ratings in 10 years. Seventy percent of soybeans are listed in excellent or good condition, down 1 point from a week ago. Crop maturity is slightly above average. Some 72 percent of soybeans are setting pods, compared to the five-year average of 65 percent.