Corn, soybean prices soar on USDA production, yield report
Majority of Iowa still in extreme drought category
The drought continues to have the state — and its crops — in its grip despite some rain earlier this week, according to the U.S. Drought Monitor released Thursday and reflecting rainfall through 6 a.m. Tuesday.
A majority of Iowa is still listed in the extreme drought category, with northeast and southeast counties in severe drought and some extreme northwest counties in exceptional drought.
The National Weather Service is forecasting rain showers for portions of Iowa — including Eastern Iowa — and the upper Midwest on Friday night, Saturday and through midday Sunday.
Corn and soybean futures prices jumped Thursday after a new government report predicted a corn harvest virtually unchanged from last month's prediction but a lower soybean production.
Corn soared 34 cents, to $7.70 per bushel, for December delivery in early trading on the Chicago Board of Trade. Soybeans jumped 32 cents, to $15.56 per bushel, for January delivery.
The U.S. Department of Agriculture said national corn production will be 10.7 billion bushels, down slightly from the September forecast and down 13 percent from 12.4 billion bushels in 2011. That represents the lowest production in the United States since 2006.
Based on conditions as of Oct. 1, yields are expected to average 122 bushels per acre, down 0.8 bushels from the September forecast and 25.2 bushels below the 2011 average. If realized, it will be the lowest average corn yield since 1995.
Soybean production nationally is forecast at 2.86 billion bushels, up 9 percent from September but down 8 percent from last year. Based on Oct. 1 conditions, yields are expected to average 37.8 bushels per acre, up 2.5 bushels from last month but down 4.1 bushels from last year.
Iowa’s corn production is forecast at 1.92 billion bushels per acre, down 19 percent from 2.26 billion bushels per acre in 2011. As of Oct. 1, Iowa’s corn crop is forecast to yield 140 bushels per acre, unchanged from last month's forecast, but down from 172 bushels per acre in 2011.
If realized, Iowa's corn yield will be substantially below the record 182 bushels per acre recorded in 2009 due to the historic drought that reduced corn pollination in July.
Iowa’s total acres harvested for corn fell to 13.7 million acres, down 500,000 acres from earlier estimates. The lower harvest figure reflects a higher-than-normal amount of corn chopped for silage by livestock producers.
Iowa farmers planted 9.35 million acres of soybeans and plan to harvest 9.29 million acres. The Oct. 1 yield forecast of 43 bushels per acre is up 4 bushels from September.
If realized, soybean production would be 399 million bushels, down from last year’s production of 475 million bushels.
The hay yield for alfalfa and alfalfa mixtures is expected to be 2.9 tons per acre, down 15 percent from 3.4 tons per acre in 2011 due to the drought. Hay production for alfalfa and alfalfa mixtures is forecast at 2.32 million tons, down 17 percent from 2.8 million tons in 2011.
The drop in hay production has been reflected in higher prices at weekly auctions, a trend that is expected to continue into November and December.
At Wednesday's Dyersville Sales hay auction, the market was firm to $25 per ton higher with most of the increase coming from lower end hay. Top on big squares was $265 per ton. Round bales topped at $227.50 per ton for grass.
At the Fort Atkinson Hay Market on Wednesday, high loads of the day were fourth-crop round bales at $250 per ton, followed by first crop of big square bales at $245 per ton and third crop of small squares at $245 per ton.
The Fort Atkinson auction reported an active group of bidders, with most buyers only able to buy a single load. About half of the loads of hay sold for $200 per ton or more, including a semi-load of grass rounds from Duluth, Minn., selling at $225 per ton.Dyersville and Fort Atkinson reported that high quality hay continues to sell very well.