The focus on weather for both the U.S. corn and soybean crops since mid-June has been warranted. As the growing season progressed, adverse weather conditions persisted well into July in large parts of the Midwest. Recently, attention has become more focused on the U.S. soybean crop, as August is the time that is most critical for soybean yields. The importance of the size of this crop this year is magnified by the small South American harvest realized in February and March of 2012 from drought conditions in that area of the world.
Steve Johnson, an Iowa State University Extension farm management specialist in central Iowa, offers the following information on the soybean marketing situation.
Soybean production forecast will be updated August 10 with USDA Crop Report
In the latest World Agricultural Supply and Demand Estimate report released July 11, the USDA estimated the U.S. average yield potential at 40.5 bushels and production at 3.05 billion bushels. That would be about equal to last year's U.S. crop size. However, crop conditions have declined sharply during July and into August. There is still a perception that average yields could still be obtained if "decent weather" turned more favorable from late July through August.
In the driest areas of the Midwest, permanent yield losses may have already occurred as plant size and pod counts have been reduced. It will be interesting to see what the USDA's August Crop Report says when it is released August 10.
According to Darrel Good, grain marketing economist with University of Illinois Extension, the forecast of U.S. average yield based on trend yields since 1986, percentage of the 2012 crop that was planted late, and the percentage of the crop currently rated in good or excellent condition is near 39.4 bushels per acre.
This year's August soybean yield forecast may be a little less reliable than normal
A yield of 39.4 bushels, using the USDA National Ag Statistics Service forecast of harvested acres, would result in a crop of 2.967 billion bushels. The lower U.S. production would require soybean consumption in the 2012-13 marketing year to be about 105 million bushels less than during the current year.