With the fall harvest getting under way, traders expect the USDA to trim its estimate of the U.S. corn crop by more than a quarter-billion bushels on Monday but to stick to its forecast of the largest soybean crop ever, at roughly 4.5 billion bushels. Dry weather in the western Corn Belt, including powerhouses Iowa and Nebraska, will lower corn production to just below 14.1 billion bushels, or 1 billion bushels less than last year, according to the average estimate from traders surveyed by wire services.
Fifteen percent of the Midwest is affected by drought, twice as much of the region as a week ago, said the Drought Monitor on Thursday, as corn and soybean crops entered their reproductive stages. Illinois, Indiana, and Missouri had the largest increases, up 10 percentage points or more.
The planting season has been delayed by cold weather in four of the five top corn states, a stark contrast to last year's early start, said the Agriculture Department on Monday. The planting window for top yields "is relatively wide," said a University of Illinois economist but this year's slow start has driven up futures prices.
A growing number of farmers, researchers and nonprofits are working to transform the Midwestern corn and soybean belt into a more diverse cropping region, including a new USDA-funded project at Purdue University designed to study how to help growers diversify their farms. (No paywall)
In the space of two months, the USDA has shaved more than half-a-billion bushels from its estimate of this year’s corn harvest and pared the soybean forecast by a similar 3.5 percent. The crop are still bin-busters but they are more manageable than initially expected and should fetch much …
A larger-than-usual portion of the U.S. corn crop will be planted so late that yields could be depressed, said two University of Illinois economists on Thursday. “A reasonable estimate is that late corn planting in 2019 will be at least 5 to 10 percent above average.”
Spring flooding in the northern Plains and western Corn Belt will have a marginal impact on corn and soybean plantings, according to a USDA survey of growers and initial tallies of flooded land. With normal weather and yields, there would be limited impact on production of the two most widely grown U.S. crops, thanks to the huge amount of cropland nationwide.
With a nationwide average of $4,130 an acre this year, the value of U.S. cropland is nearly unchanged from the 2014 average of $4,100 an acre, according to an annual USDA survey of producers.
Farm lending has stabilized in the face of low agricultural profit margins, says a quarterly Federal Reserve report on ag banks. Operating loans, to pay day-to-day expenses, have accounted for nearly 60 percent of non-real-estate loans for the past year, "the highest in the 40 year survey history," says the report of conditions nationwide.
Given the choice, Corn Belt farmers vastly prefer revenue guarantees for their crop, whether through crop insurance or farm subsidies, over coverage that is based on yields, says economist Gary Schnitkey of the University of Illinois. The research shows why proposals to revamp the federally subsidized crop insurance program typically bog down in Congress.
South Dakota State University will launch the nation's first four-year degree in precision agriculture this fall, with a goal of educating "the next generation of innovators," reports AgWeb
Crop-insurance claims by farmers for prevented planting are up by 48 percent this year, said Bloomberg, a reflection of the cold and rainy spring. Growers filed claims on 2.3 million acres of corn and nearly 2.2 million acres of soybeans, said the news agency, based on its review of federal data.
A rainy spring that delayed planting in the western Corn Belt will mean a smaller-than-expected soybean crop, traders said ahead of today's Crop Production report, which makes the first forecast of the fall harvest.
Cropland in the Corn Belt is worth an average $6,840 an acre, down 2.3 percent from last year, according to the USDA's annual Land Values report.
Farmers in the Midwest and Plains - the major regions for corn, wheat and soybean production - are borrowing money to pay short-term operating expenses because shrinking crop income makes it harder to pay cash, according to a survey of ag bankers.
Stockpiles of U.S. corn and soybeans are smaller than expected, giving a boost to futures prices in the near term, although massive harvests of the two most widely planted crops in the nation are on the horizon.
"Good" farmland declined in value by 3 percent in the central Corn Belt during 2014, "marking the first yearly decline since 1986," said the Chicago Federal Reserve Bank, based on a survey of bankers. The largest decline was 7 percent in Iowa. "Half of the respondents expected farmland values to fall during the January through March period of 2015," said the Chicago Fed in its quarterly Ag Letter. Only 1 percent of lenders "remained hopeful that farmland values would rise in the areas surrounding their respective banks."
Farmers and ranchers are tightening their purse strings and spending less in town, say farm bankers across the Farm Belt. With farm income down due to sharply lower commodity prices, cutbacks are expected to continue into the fall at a minimum.