Record U.S. corn and soybean crops in 2014 will mean bigger inventories before next year’s harvests, the government said.
Corn yields in 2014 may jump 4.1 percent to produce a record 13.985 billion bushels, leaving stockpiles on Aug. 31, 2015, at 2.111 billion bushels, the highest since 2005 and 43 percent larger than the 1.481 billion projected for a year earlier, the U.S. Department of Agriculture said today in a report. Soybean output will be a 3.55 billion bushels, with reserves almost doubling to 285 million bushels next year from a projected 150 million this year, the USDA said.
“Better weather is likely to improve corn and soybean yields this year,” Mark Ash, a USDA economist, said during the agency’s annual outlook conference in Arlington, Virginia. “Even with smaller global crops, large carryover stocks of corn and soybeans will sustain competition for U.S. exports. Crop prices will continue to decline.”
The average price paid to corn farmers in the 12 months that begin Sept. 1 will drop to $3.90 a bushel from $4.50 this year, the USDA said yesterday. Soybeans will drop to $9.65 a bushel from $12.70, the agency said.
Corn futures reached $4.60 today on the Chicago Board of Trade, down 46 percent from a record $8.49 in August 2012. Soybean futures slid to $13.455, down 25 percent from a record in September 2012.
U.S. wheat inventories will rise to 587 million bushels before the 2015 harvest, compared with 558 million projected for June 1, the USDA said. Production may rise 1.4 percent to 2.16 billion bushels as farmers harvest a larger percentage of planted acreage. U.S. export sales may fall 11 percent to 1.05 billion from 1.175 billion this year.
“Wheat exports will slow from stiff foreign competition,” Ash said. “Canadian logistical problems will ease by 2014,” reducing demand for supplies from the U.S., he said.
Wheat futures for May delivery fell 0.3 percent to $6.115 a bushel on the CBOT. Through yesterday, the price dropped 18 percent in the previous 12 months.
The U.S. is the top exporter of corn and wheat and ranks second in soybeans, behind Brazil.