Combines across Nebraska have been running the month of October, even if the government hasn’t been. With the 17% government shut down, the USDA confirmed that the Crop Estimate and World Supply and Demand report will not be released as usual, since the data analysts and those who compile harvest data from Farm Service Agencies were furloughed the majority of October. Since being reinstated there is now a back log of data. This leaves market analysts and farmers wondering about the particulars of the harvest data, including projections about corn and soybean acres.
In particular, due to the late, wet spring planting conditions, analysts were interested in seeing the prevented planting acreage numbers that were to be included in this report, and how this data might affect the overall corn and soybean markets. In mid-September, FSA reported that 3.57 million acres of corn and 1.69 million acres of beans were prevented from being planted. For the time being, though, life does go on, and the crops don’t care how soon Congress gets its act together.
Timing-wise, the start of the Nebraska harvest has been average to slightly later, although it has been much later than last year’s atypically early harvest. As of Oct. 8th, the overall corn harvest nationally was at 12% vs. the historical average of 23%. Beans were further behind at 11% vs. 20% historical average. Nebraska farmers were out in force, before a large rain system moved through the eastern half of the state, dumping significant amounts of rain in many areas and stalling harvest for several days. Frost was forecasted for certain areas, but stayed away the first part of October.
So far, corn and soybean yields have been higher than predicted or expected. Private analysts continue to report higher-than-expected yields for corn, with the average September corn yield higher than the 155.3 bushels/acre that was previously estimated. Higher than expected yields have resulted in rather bearish corn market. While soybean yields are also good so far, the USDA already raised last year’s crop size by 19 billion acres, so market adjustments to use should be minimal. Additionally, while early yields from early-planted fields have been favorable for both corn and beans, it’s still questionable whether or not these yield numbers will hold up as farmers begin to harvest from later-planted fields.
Favorable yields have also brought down the basis of both corn and beans, with the bean basis 5 cents lower than the 5 year max average and the corn basis is even with the 5 year max average. (dtn.com) Some analysts believe the basis will continue a downward trend as harvest continues.
To date, the markets have coped fairly well without the smaller, weekly USDA reports. However, as we approach additional government budget issues, all the markets may feel the effects, including the grain markets. Hopefully negotiations on Capitol Hill will move forward and further shutdowns can be avoided.
If you’re looking for assistance managing the constant changes happening with your farmland, contact a UFARM manager for a free consultation.