Despite severe flooding throughout much of the Corn Belt in June, crops have rebounded with yields expected to produce the second-largest corn crop and the fourth-largest soybean crop in history.
In its first estimates this year based on field visits and farmer surveys, the U.S. Department of Agriculture (USDA) sharply raised its estimate of corn production and said “nearly ideal” weather has helped crops recover.
That recovery could eventually lead to further drops in corn and soybean prices, helping pork producers reduce spiraling feed costs.
As it is, corn prices have dropped 35% from record highs of almost $8/bu., reached after floods devastated major corn-growing regions in Iowa and Illinois.
The USDA forecast that farmers would harvest 12.3 billion bushels of corn, up more than 570 million bushels from last month’s estimate of 11.7 billion. That’s down 6% from last year’s record crop of 13.1 billion bushels, but 17% above the 2006 harvest.
Average corn prices are expected to drop to $4.90 to $5.90/bu., down 60 cents from last m onth’s forecast of $5.50 to $6.50.
USDA is predicting average corn yields will reach 155 bu./acre, up from last month’s estimate of 148.4.
The USDA lowered its estimate for soybean yields to 2.97 billion bushels from 3 billion last month.
Soybean prices are expected to fall to $11.50 to $13/bu., compared to $12 to $13.50 last month, USDA said.