Markets anticipated strong yield projections in the September WASDE, and USDA delivered. Farmers enter the 2024 harvest with 64% and 65% of their corn and soybean crops, respectively, in good to excellent condition, according to the September 9th USDA crop progress report for week ending September 8, 2024.
The USDA forecast of 183.6 bushels per acre for corn was near the upper end of market projections ahead of the WASDE, which ranged from 180.5 to 184 bushels per acre. The USDA put soybean yields at 53.2 bushels per acre, between the 52 and 54.9 bushels per acre anticipated by the market ahead of the report.
Higher expected crop yields led markets to anticipate increased 2024/25 production. Markets ahead of the WASDE expected corn to exceed 15.1 billion bushels and soybeans over 4.6 billion bushels. USDA’s September forecast for 2024/25 corn production was slightly higher than the market’s pre-report average but given the wide range of forecasts from market analysts, USDA was relatively aligned.
For soybeans, the market anticipated a record-setting soybean crop and USDA delivered in its September forecast. The USDA projects a soybean harvest of more than 4.5 billion bushels -- record production if true, but below the market’s average expectation, providing some bullish intent in the soybean market.
Slightly higher ending stocks for corn and soybeans were anticipated by the market ahead of the WASDE, though private sector estimates varied widely. The highest corn ending stock estimate from the private sector was over 2.1 billion bushels, 47 million bushels above USDA’s August estimate from last month, likely due to slow export pace and no purchases from China so far for the new marketing year. The USDA’s September forecast of approximately 2.06 billion bushels was slightly above the market’s average expectation by 48 million bushels, but well within the range of private sector estimates.
For soybeans, slow export sales and strong domestic crush have been the story in the market ahead of the September WASDE. The USDA’s forecast for 2024/25 soybean ending stocks was 28 million bushels below the market’s average expectation but within the range of estimates. Table 1 provides a summary of pre-report expectations for the 2024/25 corn, soybean, and wheat crops.
Table 1. Pre-Report Expectations vs. 2024 September WASDE Estimates for 2024/25 Corn, Soybean, and Wheat Crops.
| 2024/25 Yields (September WASDE & Pre-Report) | |||
|---|---|---|---|
| 2024 Sept. WASDE | Average | Range | |
| Corn | 183.6 | 182.7 | 180.5 - 184.0 |
| Soybeans | 53.2 | 53.4 | 52.0 - 54.9 |
| 2024/25 Production (September WASDE & Pre-Report) | |||
| 2024/25 Pre-Report Production Estimates (Million Bushels) | |||
| 2024 Sept. WASDE | Average | Range | |
| Corn | 15,186 | 15,154 | 14,974 - 15,932 |
| Soybeans | 4,586 | 4,609 | 4,477 - 4,740 |
| 2024/25 Ending Stocks (September WASDE & Pre-Report) | |||
| 2024/25 Pre Report Ending Stocks Estimates (Million Bushels) | |||
| 2024 Sept. WASDE | Average | Range | |
| Corn | 2,057 | 2,009 | 1,819 - 2,120 |
| Soybeans | 550 | 578 | 443 - 670 |
| Wheat (All) | 828 | 820 | 800 - 835 |
| 2024/25 World Ending Stocks (September WASDE vs. Pre-Report) | |||
| 2024/25 Pre-Report World Ending Stock Estimates (Million Metric Tons) | |||
| 2024 Sept. WASDE | Average | Range | |
| Corn | 308.35 | 309.0 | 307.4 - 311.0 |
| Soybeans | 134.3 | 134.2 | 133.0 - 135.0 |
| Wheat (All) | 257.22 | 255.8 | 254.1 - 257.0 |
| *Red = Sept. WASDE above "Pre-Report Avg"; Green = Sept. WASDE below "Pre-Report Avg" Source: USDA | |||
Monitor for Tar Spot – Every Bushel Matters
Tar spot recently emerged in areas of the corn belt due to excess moisture, high humidity, and cooler temperatures during parts of the summer. Recent warm weather has slowed its development, and its appearance late in the growing season means it is unlikely to significantly impact the 2024 U.S. corn crop.
Producers should still monitor for tar spot, record its presence, and have a fungicide plan, as bushels will likely carry margins in today’s low commodity price environment. Historical data from the Crop Protection Network shows county-level maps of tar spot occurrences since 2018. If tar spot is found, it should be recorded and planned for in future years.
Figure 1: Maps of Tar Spot Areas Either Listed as Scouted, But Not Found, Probable, Positive, or Found in Previous Years (2018 – 2024; map of 2023 not found)
Corn Outlook
The USDA adjusted its August forecast for 2024/25 corn, projecting smaller supplies and a slight decrease in ending stocks. Beginning stocks were lowered due to increased exports and ethanol use in the previous marketing year.
The USDA increased corn production 39 million bushels to nearly 15.2 billion bushels and yields 0.5 bushels to 183.6 bushels per acre. If realized, this would be the second-largest corn crop on record. This increase seemed warranted given the condition of the 2024/25 crop. Good to excellent conditions for the U.S. corn crop seem to warrant the increase in yields from USDA.
Figure 2 shows the relationship over the past 25 years between the U.S. corn crop’s good to excellent condition as of Week 36 (equivalent to the September 9th USDA crop progress report for week ending September 8, 2024) and the difference between a crop’s final yield from its trendline, established earlier in the year in the May WASDE.
As shown from the blue dot in Figure 2, USDA’s September yield estimate for corn is 2.6 bushels per acre above the May WASDE trendline estimate. But the current good-to-excellent conditions indicate the U.S. could hit the 25-year trendline, in which case farmers could see an additional 2.8 bushels per acre to this year’s corn crop. Regardless, this suggests that corn yields are expected to be strong based on current good-to-excellent conditions.
The usage portion of the 2024/25 balance sheet is unchanged from August. However, due to the reduction in supplies on higher exports and ethanol use in 2023/24, ending stocks were lowered by 16 million bushels from USDA’s August estimate to 2.1 billion.
The domestic stocks-to-use ratio was lowered slightly -- from 13.8% in August to 13.7% -- and remains above the five- and 10-year averages. Meanwhile, the global corn situation remains tight, with a stocks-to-use ratio of 25.3%, which is below both the five- and 10-year averages.
The season-average corn price declined $0.10 to $4.10 per bushel.
Soybean Outlook
The USDA trimmed beginning stocks, production and ending stocks since August. The September production estimate of 4.586 billion bushels was a decline of 3 million bushels. Beginning stocks were lowered 5 million bushels due to increased crush in 2023/24.
While the USDA left crush and exports for 2024/25 unchanged, ending stocks from August to September dropped 10 million bushels to 550 million, still the highest level since 2018/19. The domestic stocks-to-use ratio declined slightly from 12.7% in August to 12.5%, well above the five- and 10-year averages
Soybean yields were unchanged, although an upward adjustment could have been supported by the crop’s 65% good-to-excellent condition and its historical relationship to final yield differences from trendline yields.
As shown from the yellow dot in Figure 3, USDA’s September yield estimate for soybeans is 1.2 bushels per acre above the May WASDE trendline estimate. But the current good-to-excellent conditions indicate the U.S. could hit the 25-year trendline, in which case farmers could see an additional 1.3 bushels per acre to this year’s soybean crop. This would be near Pro Farmer’s estimate of 54.9 bushels per acre based on their August crop tour. Regardless, there is upside yield potential given the historical relationship between soybean yield changes from its trendline yield and with overall crop conditions.
Global soybean production was slightly increased from August to September to 429.2 million metric tons, with higher outputs from Paraguay and Canada offsetting lower production in the EU. Trade for 2024/25 rose to 181.6 million metric tons due to higher exports from Paraguay and imports by Argentina. World soybean ending stocks increased by 0.28 million metric tons to 134.58 million metric tons, a record high. The global stocks-to-use ratio for 2024/25 is 33.1%, significantly above the five- and 10-year averages.
The season-average soybean price remains at $10.80 per bushel.
Wheat Outlook
The U.S. wheat outlook is unchanged since August. This includes a projected season-average farm price of $5.70 for marketing year 2024/25.
The global wheat outlook, however, points to increases in supplies, consumption, trade and ending stocks. Supplies are expected to grow 1.5 million tons to 1,062.1 million, mainly due to higher beginning stocks, particularly from Canada.
Production in the EU declined due to unfavorable weather but was partially offset by higher production in Australia and Ukraine. Overall, world wheat production fell slightly, 1.4 million tons to 796.9 million tons. Still, global production remains record high.
Global consumption is projected to increase 0.9 million tons to 804.9 million, driven by higher feed and residual use. World trade is expected to rise 1.7 million tons to 216.5 million, with higher exports from Australia, Canada, and Ukraine.
Ending stocks are forecasted to increase 0.6 million tons to 257.2 million metric tons, with notable increases in Canada, Brazil, and Kazakhstan. USDA’s projection for world ending stocks came in 1.42 million metric tons above the market’s pre-report expectation.
The 2024/25 global stocks-to-use ratio for wheat remains relatively tight at 32%, which is 3.7 percentage points below five-year average and 3.9 percentage points below the 10-year average.
