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OVERVIEW

The USDA provided updated projections for the production of corn and soybeans in the September 12^thWorld Agriculture Supply and Demand Estimates (WASDE) #652, reflecting the anticipated 2024 crop. Production values for corn and soybeans were updated from the August edition and are based on actual field data. Projections of crop size and ending stocks are derived from acreage planted, estimates of yields, carry-forward levels from 2023, and with the latest assumptions relating to domestic use and exports.

The September 12^th WASDE report predicted that corn would be harvested from 82.7 million acres, unchanged from the August projection. The soybean crop will be harvested from 86.3 million acres, unchanged from the August report.

The September WASDE increased the yield value for the 2024 corn crop by 0.3 percent to 183.6 bushels per acre. By comparison yield was 174.9 bushels per acre in 2023. The July soybean yield was unchanged at 53.2 bushels per acre compared to 49.9 bushels per acre in 2023.

The September USDA projection for the ending stocks of corn was down 0.8 percent to 2,057 million bushels. The September USDA projection for the ending stock of soybeans was down 1.8 percent to 550 million bushels.

The September 2024 WASDE reduced the projection of corn price by 10 cents to 410 cents per bushel. The projected average season price for soybeans was held at 1,080 cents per bushel. The price of soybean meal was unchanged at $320 per ton. Projected commodity prices suggest stable to lower feed costs for livestock and poultry producers. Row crop farmers will experience lower margins or in some areas corn will be below break-even given relative production costs and per bushel price. This situation has contributed to an impasse in the decisions of the respective House and Senate Agriculture Committees regarding allocation of funding for the combination of nutrition support and conservation over farm commodity price supports in the delayed Farm Bill.

Projections for world output included in the September 2024 WASDE report, reflect the most recent estimates for the production and export of commodities especially in the Southern Hemisphere with an emphasis on Argentine and Brazil. Economists also evaluated the likely impacts from ongoing hostilities in Ukraine following extensive destruction of agricultural infrastructure by the Russian Federation. It is evident that production and hence exports of wheat, corn and sunflower from Ukraine will be reduced compared to pre-war averages.

It is accepted that USDA projections for export are also based on the perceived intentions and needs of China. This Nation has sharply curtailed purchases of commodities and especially U.S. soybeans during the current market year despite an anticipated transition to a La Nina event and recovery of the Nation’s economy influencing consumer demand for food and fuel.

Reports on volumes of commodities exported are included in weekly editions of EGG-NEWS, derived from USDA-FAS sales data. Weekly Crop Progress reports will be posted through late November

CORN

Based on current yield and acreage projections for the 2024 corn harvest, the September WASDE Report predicted a crop of 15,186 million bushels, up 0.3 percent from August and compared to 15,234 million bushels for the previous 2023 record harvest. The “Feed and Residual” category was held at 5,825 million bushels. The Food and Seed category was unchanged at 1,390 million bushels. The Ethanol and Byproducts Category was unchanged at 5,450 million bushels consistent with estimated demand for E-10 and higher blends for fall driving needs. Projected corn exports were held at 2,300 million bushels, based on recent orders, and ongoing shipments to China and taking into account the anticipated lower availability of coarse grains from Eastern Europe. For market year 2023-2024 exports of U.S. corn were 36.9 percent higher, compared to the previous market year. The USDA considers world weather patterns in developing projections including the effect of the transition to a La Nina event during the fourth quarter of 2024. The anticipated ending stock of corn in the September WASDE report was down 0.8 percent from the August WASDE to 2,057 million bushels.

The forecast USDA average season farm price for corn in the September WASDE report covering the 2024 crop was reduced 10 cents to 410 cents per bushel. At the close on September 12^th after the noon release of the WASDE the CME spot price for corn was 409 cents per bushel, down 2.0 percent from the quotation on August 12^th and down 0.8 percent from the September USDA projection.

September 2024 WASDE #652 Projections For The 2024 Corn Harvest:

1 metric ton = 39.368 bushels

Average Farm Price: 410 cents per bushel. (Down 10 cents per bushel from the August WASDE Report reflecting the 2024 projected crop)

SOYBEANS

Based on a prediction of increased acreage to be planted and adjusted yield, the USDA August WASDE projected the 2024 soybean crop at 4,586 million bushels, down 0.1 percent from August with an estimated yield of 53.2 bushels per acre from 86.3 million acres harvested. Crush volume was unchanged from the August WASDE report at 2,425 million bushels despite increased industry capacity. Projected exports were unchanged at 1,850 million bushels despite reduced exports to China. For market year 2023-2024 exports were down 14.9 percent from the previous market year. Ending stocks were anticipated to be 550 million bushels, down 1.8 percent from the August WASDE report. This was mainly due to the projected increase in production and carry over as compared to the projection in the August WASDE.

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There is uncertainty over orders from China for the current market year. This is attributed to competition from Brazil and an assumption of lower requirements for animal feed due to restrictions on pork production by the Central Government. In reality traders in China are obligated to order on a stable or declining market unless faced with shortages. Prior to 2018, China, the largest trading partner for U.S. agricultural commodities, imported the equivalent of 25 percent of U.S. soybeans harvested.

The USDA September 2024 projection for the ex-farm price for soybeans for the 2024 harvest unchanged from August at 1,080 cents per bushel. At close on September 12^th following release of the WASDE, the CME spot price was 1,019 cents per bushel, up 3.7 percent compared to the August 12^th quotation and 5.6 percent below the September USDA projection.

September 2024 WASDE #652 Projection for the 2024 Soybean Harvest:-

1 metric ton = 36.74 bushels

Average Farm Price: 1,080 cents per bushel (Unchanged from the August 2024 WASDE Report)

SOYBEAN MEAL

The projected production of soybean meal from the 2024 soybean crop will be 57.08 million tons, unchanged since the June WASDE and consistent with the 2,425 million bushel projected soybean crush volume. This figure also corresponds to stagnant demand for biodiesel and with expanded U.S. crushing capacity. Production is driven both by exports and domestic consumption for livestock feed and for soy oil supplying the food and biodiesel segments. The projection of domestic use was unchanged 40.125 million tons. Exports were held at 17.50 million tons.

The USDA held the ex plant price of soybean meal in the September WASDE at $320 per ton as an average for the season based on supply and demand considerations as reflected in a stable ending stock of 450,000 tons representing 0.8 percent of supply.

At close on September 12^th the CME spot price for soybean meal was $325 per ton, up 5.4 percent compared to the August 12^th CME quotation and 1.5 percent higher than the WASDE projection of $320 per ton.

 September 2024 WASDE #652 Projection of Soybean Meal Production and Use

(Quantities in thousand short tons)

Average Price ex plant:$320 per ton (Unchanged from the August WASDE Report)

IMPLICATIONS FOR PRODUCTION COST

The price projections based on CME quotations for corn and soybeans suggest lower feed production costs for broilers and eggs. Going forward, prices of commodities will be determined by World supply and demand and U.S. domestic yield, use and exports.

For each 10 cents per bushel change in corn:-

• The cost of egg production would change by 0.45 cent per dozen
• The cost of broiler production would change by 0.25 cent per live pound

For each $10 per ton change in the cost of soybean meal:-

• The cost of egg production would change by 0.35 cent per doze
• The cost of broiler production would change by 0.30 cent per live pound.

WORLD SITUATION

With respect to world coarse grains and oilseeds the September 2024 WASDE Report included the following appraisals by USDA:-

COARSE GRAINS:

“Global coarse grain production for 2024/25 is forecast 1.8 million tons lower to 1.502 billion. This month’s 2024/25 foreign coarse grain outlook is for lower production, virtually unchanged trade, and reduced stocks relative to last month. Foreign corn production is forecast down with declines for the EU, Ghana, Russia, and Serbia partially offset by increases for Tanzania and Canada. EU corn production is lowered based on reductions for Romania and Hungary partially offset by an increase for France. Foreign barley production is lower with declines for Canada and the EU partly offset by an increase for Australia”.

“Major global coarse grain trade changes for 2024/25 include larger corn exports for Tanzania and Canada with reductions for Russia, the EU, and Serbia. Corn imports are raised for the EU, Mexico, India, and Thailand but reduced for China, Canada, and Iran. Foreign corn ending stocks are cut 1.4 million tons to 256.1 million, mostly reflecting a reduction for China partly offset by an increase for Tanzania. World corn ending stocks, at 308.4 million tons, are down 1.8 million”.

OIL SEEDS:

“Foreign 2024/25 oilseed production is reduced 2.8 million tons to 552.7 million mainly on lower rapeseed production for the EU and lower sunflower seed production for the EU, Ukraine, Kazakhstan, and Moldova. Foreign soybean production is raised 0.6 million tons on higher production for Paraguay and Canada partly offset by lower output for the EU and Serbia. Production for Paraguay is increased for 2022/23 through 2024/25 on higher area. Production in Paraguay for 2023/24 is raised to reflect the strong pace of exports and crush to date”.

“Global soybean trade for 2024/25 is increased to 181.6 million tons on higher exports for Paraguay and imports for Argentina. Global soybean ending stocks are increased 0.3 million tons to 134.6 million as higher stocks for Argentina and Canada are partly offset by lower stocks for the United States and the E.U”.

World and U.S. Data Combined for Coarse Grains and Oilseeds:-

*Values rounded to one million metric ton

(1 metric ton corn= 39.37 bushels) (“ton” represents 2,000 pounds)