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Is Today's 167.4 Corn Yield January's 179.0?

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The USDA did not raise corn yields to the level expected ahead of today’s WASDE report although several key corn states are expected to put in new records. All three “I” states are expected to raise corn yield records by as much as 8 bu/acre in Illinois to 188 by/acre followed by Iowa, up 3 bushels to 185 bu/acre and then Indiana, up 2 bu/acre to a new state record of 179 bu/acre. Big corn yields were also expected in Nebraska and Minnesota but not records. I find it interesting to see huge yields in Louisiana (180 bu/acre) and Mississippi setting a new record at 178 bu/acre. If deep southern states are producing Midwest style yields, how can there be much worry to end users which also builds the case for softer basis on into early harvest areas.

Our analysis of comparable growing seasons, 1992, 1996, 2004 and 2009 indicates the USDA might be under estimating final January corn yields by as much as 8.8 bu/acre. On average, those years produced final yields that were 8.8 bu/acre higher and in the case of 2004, 11.4 bu/acre. Using today’s USDA corn yield estimate, should we be thinking about final yield potential somewhere in the 176-179 bu/acre territory? Not so fast.

 

 

 

The proof of the this potential is found in today’s “Derived Grain Weight vs Ears per acre” result from the 1,920 NASS objective yield checks performed in 10 key states. Note in the chart below, ear counts were reported approximately 28,600/acre, the highest on record for an August report. Grain weights used in this report were estimated and could be far higher as in the case of the record 2004 number but do not get revised until the September and more so in the October report. So someone smarter than me needs to do math – what will the 2014 corn yield be “IF” a grain weights similar to 2004 were substituted?

 

We called a friend to help with the math to our question. We include the assumptions below or just skip to the last few lines:

So, let’s assume the 2004 derived ear weight was 0.351 pounds per ear. Looking at the graphic, the 2014 ears-per-acre looks to be about 28,600.
The total pounds per acre would be 0.351 x 28,600 = 10,039 (rounded). Divide the total pounds per acre by 56 (pounds per bushel) gives us a yield per acre of 179.3.

This 179.3 is for the ten objective yield states.

Now, we must estimate the total production. I guess we can make two assumptions.

1. All states will behave like the ten objective yield states (OY).

a. The NASS 2014 yield was 172.3 for the ten OY states. Our estimated yield using 2004 ear weights is 179.3 or about 4% higher than the NASS August yield.
b. The NASS August yield for the non-OY states was 147.9 bpa. Applying a 4% increase would give us a yield of 159.9 bpa.
c. Taking both yield estimates and use the published NASS harvested acres give us an estimated production of 14,599,000 (wow!) and a US yield of 174.1 (wow!).

2. Assume the 10 (OY) state’s yield goes up and the other states remain the same.

a. Use 179.3 (our estimate from above) for the 10 OY states and 147.9 for the other states.
b. Taking the yield from 2a and use the published NASS harvested acres give us an estimated production of 14,497,000 (almost a wow!) and a US yield of 172.9.

Given these assumptions we can say there is a potential that the US corn yield could end up somewhere between 172 and 174 bpa if we used the 2004 ear weights. I think if this number is correct (172-174 corn yield), we are already trading too low as demand is far too large to lay down when corn is this cheap.

Brian Roach


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