U.S. farmers will reap two of their largest corn and soybean crops ever and sell them for the highest average prices since the commodity boom ended several years ago, said the government last week in its first projections of the fall harvest.
The USDA also said that global soybean king Brazil would increase its share of the world market at the expense of U.S. exports.
The planting season is in full swing, so the projections in the USDA’s monthly WASDE report are a long-range look at the potential outcome, months away, of the growing season.
Although it expects smaller exports of the three major field crops, the USDA said this year’s corn, wheat, and soybeans would fetch markedly higher prices at the farm gate than the 2020 crops now on the market —$2.60 a bushel higher for soybeans, for example. A price boom for agricultural commodities began last summer and remains strong despite predictions of bumper crops worldwide in the year ahead.
This year’s corn crop would sell for a season-average $5.70 a bushel, soybeans for an average $13.85 a bushel, and wheat for an average $6.50 a bushel, estimated the USDA. Those would be the highest farm gate prices since 2013 for corn and soybeans and the highest since 2014 for wheat.
The USDA projected a corn crop of 15 billion bushels, the second largest ever; a soybean crop of 4.4 billion bushels, the third largest on record; and a wheat crop of 1.87 billion bushels. Larger plantings and higher yields could boost output of all three crops —corn by 6 percent, soybeans by 7 percent, and wheat by 3 percent.
Soybeans are the most valuable U.S. farm export, accounting for 18 cents of every $1 in sales during calendar 2020, but shipments are expected to contract by 9 percent in the marketing year that opens Sept. 1.
The U.S. export share of global soybean trade is expected to decline to 33 percent from the current 36 percent, said the USDA, because of tight U.S. supplies and rising demand from domestic processors.
“Brazil’s share increases from 50 percent in 2020/21 to 54 percent in 2021/22,” when this year’s crop goes on the market, said USDA analysts.
Source: Successful Farming