Friday’s USDA Crop Production report and the November World Agriculture Supply and Demand Estimates (WASDE) confirmed what futures prices have suggested in recent months: Corn production is record large, and more plentiful than previously estimated.
WASDE pegs this year’s corn crop at a record-large 14.0 billion bu., 1% more than the previous forecast. That would make the crop a staggering 30% larger than last year. Though estimates for the area harvested declined 2% to 87.2 million acres, average yield estimates increased 5.1 bu./acre from the previous forecast to a near-record 160.4 bu./acre. That’s 37.0 bu./acre more than last year.
Total projected corn use is projected 275 million bu. higher, offsetting much of the estimated increase in supplies. But, the season-average corn price was lowered 30¢ at both ends of the range to $4.10-$4.90/bu.
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Beef production for next year is estimated to be slightly lower than the September forecast due to lower placements of cattle on feed in 2014.
The annual average steer price for this year is estimated at $125.69/cwt. The annual average for next year is estimated at $126-$137/cwt., $1 higher on the upper end of the range compared to the September estimate.
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