Iowa’s average soybean yield was increased by 1 bushel per acre from last month to 61 bushels in the October report. Accordingly, Iowa’s production estimate jumped about 3% to more than 606 million bushels.
Randy Miller, who farms near Lacona, would have believed USDA a few weeks ago as he prepared to harvest his best soybean crop ever — likely 10 bushels per acre better than normal. But persistent rains have swamped his soybean fields, idled the combine and negatively impacted the quality of his crop. About 20% to 25% of Miller’s soybean fields (70 to 100 acres) are under water.
Beans underwater don’t yield well
“It’s hard to be positive as crop conditions add insult to injury,” says Miller, who serves on the ISA board of directors. “It’s likely many of the extra bushels I was counting on to make up for lower prices are gone. Plus, I and other farmers could get docked for quality concerns when soybeans are sold.”
USDA increased its estimate of the U.S. soybean yield average slightly, to a record 53.1 bushels per acre. But overall production was reduced by 3.5 million bushels to 4.69 billion, since harvested acres were lowered by 600,000 and are now at 88.3 million for 2018.
Projected U.S. soybean exports and domestic demand were left unchanged at 2.06 billion and 2.07 billion bushels, respectively, according to USDA’s World Agricultural Supply and Demand Estimates Report. Ending stocks for 2018-19 increased by 40 million bushels to 885 million due to higher old-crop supplies, the WASDE report says.
Big crop may not be getting bigger
Don Roose, president of U.S. Commodities Inc. of West Des Moines, expects USDA to eventually lower soybean production numbers in future reports when harvest and field issues nationwide are considered. In Iowa alone, reports of pod splitting, flooding, lodging and disease are widespread.
“We’re running into real quality issues with a delayed harvest and soybeans sprouting in Iowa, snow on soybeans in the Dakotas, and problems in the Mississippi Delta in the southern U.S.,” Roose notes. “People often say big crops get bigger, but it may not happen this year.”
That could offer farmers some marketing opportunities. Even though basis levels are historically wide, he says that could change. And there’s a 50-cent-per-bushel carry in the market to hold soybeans until July. “Those are opportunities, so don’t let carries in the market get away,” Roose advises. “Farmers need to hope for basis levels to improve, the trade war with China to end and better demand.”
USDA’s price predication unchanged
USDA is predicting the season-average soybean price at $7.35 to $9.85 per bushel for the 2018 crop marketing year, unchanged at the midpoint from last month’s projection.
Grant Kimberley, director of market development for ISA, says the Iowa association is working to boost soybean demand and prices by collaborating with national soybean organizations, hosting buyers from around the world and planning trade missions.
Last month, ISA contributed an additional $50,000 toward sponsorship of a U.S. Soybean Export Council event to be held in Barcelona, Spain, in November. The annual conference, attended by buyers from Europe, the Middle East and North Africa, seeks to increase U.S. market share in new and emerging markets.
“We’re trying to drum up as much business as possible,” Kimberley says. “This includes the conference, a planned trade mission to the Philippines and advocacy efforts to grow the Renewable Fuel Standard for biodiesel.”
