Bins overflowing: Corn farmers look at another record

Bruce Peterson is president of the Minnesota Corn Growers Associatoin and farms in Northfield. (Photo from the Star Tribune)

Written by Jonathan Eisenthal

In its mid-October crop production report, with a good percentage of the grain in the bin, USDA estimated that corn producers had raised another record crop. Observers calculated nearly 14.5 billion bushels of corn would come off 83 million acres of farmland. Yield would hit 174.4 bushels per acre, national average, according to the Oct. 10 estimate from USDA’s National Agricultural Statistics Service (NASS).

Minnesota shows a major gain over last year with a forecast average yield of 170 bushels per acre. This compares to 160 bushels per acre yield in 2013. Minnesota corn growers planted 8,150,000 acres to corn and NASS estimates they will harvest grain from 7.8 million of those acres.

Perhaps the most astonishing piece of news out of the Oct. 10 report is the yield estimate for Illinois— an average of 200 bushels per acre.

“Corn production is forecast at 14.5 billion bushels, up less than 1 percent from the previous forecast and up 4 percent from 2013,” according to the USDA report. “Based on conditions as of October 1, yields are expected to average 174.2 bushels per acre, up 2.5 bushels from the September forecast and 15.4 bushels above the 2013 average. If realized, this will be the highest yield and production on record for the United States. Area harvested for grain is forecast at 83.1 million acres, down 1 percent from the September forecast and down 5 percent from 2013. Acreage updates were made in several States following a thorough review of all available data.”

The northern tier of the Corn Belt suffered a variety of weather challenges this growing season, and so represent the lower part of the top 10 corn producing states this year. Minnesota’s average yield tops the group at 170, compared to 128 in North Dakota, 151 in South Dakota, 162 in Wisconsin and 167 in Michigan.

This compares to the top performers in the center of the Corn Belt. No one comes close to Illinois’s 200 bushel average, but its neighbors Indiana and Iowa are second and third, with 186 and 185 bushels per acre, respectively. 

In terms of total haul, Iowa remains the leader, with an estimated harvest of 2.442 billion bushels harvested from 13.2 million acres. Illinois will place second, if estimates hold, with 2.34 billion bushels. Minnesota ranks fourth in volume of production at 1.326 billion bushels. Nebraska sits in third position with almost 1.6 billion bushels of corn anticipated.

Many corn farmers in Minnesota are surprised at the “somewhat aggressive” estimate that Minnesota will have boosted yields 10 bushels per acre over last year, said Bruce Peterson, a farmer in Northfield and president of the Minnesota Corn Growers Association.

“There are areas of the state where they have really good yield potential, if they were able to get planted in a timely way and they didn’t have a lot of drown-outs,” Peterson said. “In the southeast part of the state that was true. But west of me (in Northfield) the bulk of the crop was planted in late May and some didn’t go in until early June. It was much the same in the central part of the state. And then in the southwest there were lots of folks talking about drowned out areas. So when you put that all together you question the USDA estimate and ask, ‘can it really be that good?'”

Part of what keeps everyone guessing is that most of the crop is still in the fields.

“We’ve only harvested a little bit of our corn — about 7 percent is in,” Peterson said, who noted yield readings in the 180s and 190s in those first acres. “We quit because it was just too wet. That’s all the corn we’ve done so far. We’ve done a lot more soybeans. It’s our best soybean crop ever.” 

With moisture readings around 30 percent, the Petersons decided to wait and let the crop dry in the field a little longer.

“This year we have had a lot of late summer rains, all through the last half of August and all of September and that really helped the crop. The crop had a good finish to it. The cool weather always helps. Any time you get cool weather while the kernel is developing, it takes a long time, and it tends to make bigger kernels, compared to when you get really hot weather. Then the kernel matures really quickly, and ends up being smaller. We had conditions this year which should lead to large, deep kernels, and that should add to yield.

All signs point to an abundant corn supply in the coming year, with a carryover, after this year’s usage, of more than two billion bushels. This has weakened corn prices — cash prices in Minnesota are around $3.40 currently. Peterson said that hopefully most corn farmers forward-marketed at least half of their production, taking advantage of prices that hit $5.20 per bushel this summer. Looking ahead, the low prices could influence farmers’ planting decisions next year and result in a little less corn.

“Economics work,” said Peterson. “If people run the numbers and its not going to work out for corn, then people will cut back, and all of a sudden you’ve got a situation — well, you saw it this year — our (national corn) acreage was down about four million acres from the previous year. If all of a sudden you end up with less acres next year, then maybe we shrink that carryout from two billion to one-and-a-half billion. Then you’ll see some price increases on corn again.”

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