Impact of COVID-19 on Agriculture

Soybean Harvest Slows to a Crawl

Market Intel / October 17, 2018

Credit: United Soybean Board / CC BY 2.0 

USDA’s October 15 Crop Progress report revealed the U.S. soybean harvest has stagnated, with 38 percent of the soybean crop harvested, up only 3 percentage points from last week. For the week ending Oct. 15, the soybean harvest rate is down 9 percentage points from last year and 15 percentage points from the five-year average. The current harvest pace is also slightly down from analysts’ estimates of 40 percent of the soybean harvest complete by this point. Soybean producers have harvested 1.8 billion bushels throughout the U.S. so far.

While harvest should be speeding along throughout the Midwest, excessive levels of precipitation have brought progress nearly to a halt. Relative to this time last year, the soybean harvests in North Dakota and Iowa are down 74.2 million and 60.4 million bushels, respectively. Figure 1 illustrates the year-over-year change in soybean bushels harvested on a state-by-state level.

The report also shows that 39 percent of the corn harvest is complete. Corn harvest continues to outpace historical harvest pace by 12 percentage points from last year and 4 percentage points from the five-year average. U.S. corn producers have harvested 5.8 billion bushels of corn. Figure 2 illustrates the year-over-year change in corn bushels harvested on a state-by-state level.

With harvest nearly to the halfway point, the U.S. soybean crop in good-to-excellent condition decreased slightly to 66 percent. The soybean crop in poor-to-very-poor condition has increased to 11 percent. Current crops in good-to-excellent condition are up 5 percentage points from last year.

 Late season rains and residual flooding have led to saturated fields and a rise in crop damage throughout the Southeast. Georgia soybean producers are seeing an 18 percent increase in crops in poor-to-very-poor condition since August. Figure 3 outlines the two-month percentage point change in soybean crops in poor-to-very-poor condition on a state-by-state level. As shown on the map, there was a dramatic increase in the percentage of crops in poor-to-very-poor condition after Hurricane Florence hit the Southeastern coast. 

USDA estimates the U.S. corn crop in good-to-excellent condition continues unchanged at 68 percent. Crop conditions remain improved over last year’s 65 percent good-to-excellent. The corn crop in poor-to-very-poor condition is holding at 12 percent. 

Contact:
Megan Nelson
Economic Analyst
(202) 406-3629
megann@fb.org
twitter.com/@MeganRNelson1
 

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Following USDA’s March Prospective Plantings report, USDA’s June 30 Acreage report updated acreage expectations for the upcoming crop year. For the 2020/21 crop year, USDA now estimates corn planted area at 92 million acres, 3%, or 2.3 million acres, above prior-year levels. The revision is 5 million acres lower from March intended planting projections of 97 million acres, which was expected to lead to a record amount of corn production. Pre-report estimates had been calling for a reduction of 1.8 million acres, to 95.2 million acres of corn. Iowa leads the way in corn acres planted with 14 million acres, an increase of 4% compared to 2019. Illinois follows with 10.9 million acres of corn planted, up 4% from 2019, and Nebraska planted 9.8 million acres, down 3% from 2019. With 3.4 million acres, Ohio is expected to have the largest increase, 29%, in corn planted in 2020 compared to 2019. South Dakota follows with an increase of 24% in corn planting for 2020 compared to 2019 and Washington increases 18% in 2020 compared to 2019 corn planting. Figures 1 and 2 highlight USDA’s corn acres planted and the year-over-year change from 2019.

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Credit: Mike Mozzart // CC BY 2.0 

Recent price volatility related to COVID-19, though not a new phenomenon, and a modification to milk pricing rules in the 2018 farm bill are now likely to result in negative or very low returns from FMMO revenue sharing pools, i.e., negative producer price differentials. These negative PPDs are expected to offset recent price increases in the dairy farmers milk check to the effect of $5 to $7 per hundredweight. Subsequently, these negative PPDs are likely to lead to large volumes of manufacturing milk being de-pooled from FMMO revenue sharing pools. Today’s article reviews negative PPDs and the current economic conditions that have resulted in low or negative producer price differentials and the de-pooling of milk.

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