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| USDA’s crop production report projects a record crop of 10.923 billion bushels and a record yield of 148.9 bushels per acre. |
NCGA Optimistic About USDA Projections of Record Corn Crop and Yield (8-12-04)
National Corn Growers Association (NCGA) CEO Rick Tolman said corn producers are optimistic about the U.S. Department of Agriculture’s prospect of another record crop and yield and will continue efforts to stimulate demand and expand markets.
This year’s corn crop will be the largest ever and yields will increase by nearly seven bushels per acre compared to last year, according to the USDA’s crop production report released today. The agency pegs the 2004 crop at 10.923 billion bushels with an expected average yield of 148.9 bushels per acre.
If realized, the 10.9-billion-bushel crop would represent an 8 percent increase over last year’s record crop of 10.113 billion bushels and a 22 percent increase from 2002. Last year’s average yield, which also set a new record, was 142.2 bushels per acre.
“This is a phenomenal increase over last year’s crop,” he said. “It’s probably the largest year-to-year increase we’ve had in recent memory without a disaster the year before. The expected crop shows just how productive our corn sector can be.”
Feed and residual uses will constitute an estimated 5.85 billion bushels of the total crop, according to USDA. The agency says 2.77 billion bushels will be used for food, seed and industrial uses, an 8 percent increase over last year. Most of that increase is a result of the surge in ethanol production. USDA predicts 1.37 billion bushels – nearly 13 percent of the total crop – will be used for ethanol, compared to 1.2 billion bushels in 2003 and 996 million bushels in 2002.
Export use is also expected to increase from 2003 levels. USDA’s report predicts 2.1 billion bushels will be exported, compared to 1.925 billion bushels in 2003 and 1.588 in 2002.
“We’re seeing unprecedented demand for corn in the renewable fuels marketplace, and demand for livestock and export use also remains very strong,” Tolman said. “Today’s report should allay earlier fears that the supply wouldn’t be able to keep up with the demand.”
USDA’s estimated average farm price ranges from $2.05-2.45 per bushel, down from an estimate of $2.30-2.70 per bushel in the agency’s July crop production report. Tolman said growers are wary of the lower price estimates, but added that the market will likely balance itself.
“Prices were high during planting season, and growers responded to market signals accordingly,” Tolman said. “We’re confident that demand will continue to grow. We’d obviously like to see prices that allow growers to make reasonable income, but at the same time prices shouldn’t be too high to the point that they cut off demand.”
USDA estimates total use of this year’s crop at 10.72 billion bushels. The agency raised its ending stocks projection from 991 million bushels in the July report to 1.132 billion bushels in today’s release.
USDA’s July crop production report estimated a crop of 10.635 billion bushels and an average yield of 145 bushels per acre. Those figures were raised for the August report based on favorable weather conditions during much of the growing season.
Tolman said weather conditions have been ideal in most parts of the Corn Belt this summer, but the crop isn’t yet in the bin. “It’s important to remember the crop isn’t made yet,” he said. “The next month will be critical. There’s still plenty of time for things to change.”