USDA slashes US 2021-22 corn yield, production estimates

Corn production in the US in the 2021-22 marketing year (September-August) is estimated at 14.75 billion bushels, down from the previous estimate of 15.165 billion bushels in July, the US Department of Agriculture said in its World Agricultural Supply and Demand Estimates, or WASDE, report Aug. 12.

The USDA also slashed its estimate for US corn yield to 174.6 bushels/acre from the previous estimate of 179.5 bu/acre. The USDA released its season's first survey-based corn yield forecast on Aug. 12, which was 4.9 bu/acre below last month's trend-based projection.

Among the major producing states, record-high yields are expected in Illinois, Indiana, and Ohio, however, yields in Minnesota and South Dakota are forecast below a year ago, the report added.

Parts of the US witnessed exceptionally dry weather conditions which is likely to have weighed on the yield potential of the planted corn crop. The US witnessed driest weather conditions in at least 20 years, and Dakotas and Minnesota were among the worst affected regions.

The planting for the 2021-22 corn crop began in April-May, while harvest will start in September-October.

Total supply of US corn in 2021-22 is seen falling to 15.89 billion bushels compared with 16.27 billion bushels estimated earlier.

Corn usage in 2021-22 is also forecast lower at 14.65 billion bushels, compared with 14.84 billion bushels seen earlier, the USDA said as feed and residual use is estimated 100 million bushels lower than July at 5.625 billion bushels, USDA said. "Feed and residual use is down based mostly on a smaller crop and higher expected prices," it said.

Corn exports from the US in 2021-22 are forecast at 2.4 billion bushels, down from 2.5 billion bushels seen in July, it said.

The season-average farm price received by producers is raised by 15 cents/bu to $5.75/bu for 2021-22, said USDA.

US corn ending stocks estimate in 2021-22 are lowered to 1.24 billion bushels from 1.432 billion bushels seen previously in July.

Harvested area under corn in 2021-22 is maintained at 84.5 million acres.

As the yield expectations came out much lower than market expectations, corn futures prices on the Chicago Board of Trade saw a sharp jump. The most active September contract of CBOT corn was seen trading at over a month high of $5.89/bu—gaining almost 40 cents/bu within few minutes of the release of the USDA report.

Ending stocks raised for 2020-21

For the old corn crop, USDA has raised its ending stock estimates to 1.117 billion bushels from 1.082 billion bushels estimated earlier in July.

USDA cut its corn usage estimate to 15.01 billion bushels in 2020-21 from 15.045 billion bushels earlier. Feed and residual usage estimate for 2020-21 was maintained at 5.725 billion bushels but, use for ethanol was raised slightly to 5.075 billion bushels from 5.05 billion bushels.