The USDA reduced its national corn yield forecast by nearly 1% from last month’s estimate as the Western Corn Belt continues to experience hot and dry conditions. Still, the USDA is projecting this year’s corn harvest will be one of the largest in recent years.
Gro’s machine-learning Corn and Soybean Yield Forecast Models are currently pointing to lower yields than what the USDA is projecting, and Gro expects the USDA will further reduce its yield estimates as the season progresses.
In its August WASDE report, the USDA estimated corn yield of 175.4 bushels/acre, down from 177 bu/acre last month. The agency slightly raised its soybean yield estimate to 51.9 bu/acre from 51.5 bu/acre last month. Compared with last year, the USDA projected US corn production will be down 5% while soybean production will increase by 2%. The agency also trimmed its acreage estimates for both corn and soybeans.
The USDA, which relies on farmer surveys for its August yield forecasts, will incorporate the season’s first objective field data in its September WASDE report.
The US corn crop, which got off to a slow start due to overly wet weather, has been suffering from above-average temperatures and dryness. Good-to-excellent crop conditions declined in the past week to 58%, well below the G-E ratings of 64% this time last year. In Nebraska and Kansas, and parts of Iowa and Missouri, triple-digit temperatures baked the crop as it entered the critical pollination stage.
Those troubled conditions are being offset by relatively strong yields in the Eastern Corn Belt, including Illinois and Wisconsin. This week’s 2022 Gro x DTN Digital Yield Tour, a partnership between Gro and DTN, highlighted the wide regional variability across the corn and soybean belt states.
Watch a recording of last week’s Gro presentation “2022 US Corn & Soy Outlook and the Long-Term Global Impact” for a more complete analysis of our global corn view.
An encouraging sign for US corn demand is a recent rebound in China's domestic corn prices and China’s purchases this week of US new-crop corn. Gro users can monitor forward purchases by China, the biggest grain importer, and compare competitive pricing for different grains in China using this Gro display.
The USDA also cut US cotton production estimates to the lowest level since 2009/10 and projected a historically high number of cotton acres will be abandoned, especially in drought-hit Texas, as Gro wrote about here. The US is the world’s largest exporter of cotton, and production declines impact markets worldwide.
Globally, the USDA projects wheat supplies will increase in 2022/23, as contributions from Australia, Canada, and China, as well as record production from Russia, offset declines from the European Union, Argentina, and India. This summer’s heat waves across Europe also will take a toll on corn production, and the USDA cut its forecast for EU corn by 12% to 60 million tonnes.