9/12/2022

The USDA estimated the corn yield at 172.5 bpa, down 2.9 bushels from their August and right in line with expectations.  Harvested acres were lowered 1 million acres down to 80.8 million acres which was a bit of a surprise.  History tells us that when the USDA drops yield in September, the tendency is to drop it again before the final yield.  This change put the corn carryout at 1.219, which is in line with the estimate, but not telling the whole story.  What it is not telling you is the USDA cut corn usage by 570,000 bushel year on year.  And to go along with that the stocks to use ratio is down to 8.5%, which is getting tight.  The big surprise was in the bean market this time.  They lowered their national average yield estimate by 1.4 bushels to 50.5 bushels per acre and cut
harvested acres by 580,000 acres.  They had to lower crush down 20 million, exports down 70 million, and residual use down 3 million from last month just to keep the carryout at 200 million bushels.  That got the market to jump 76 cents today and insured the volatility is going to stick around for a while!  Keep that seat belt buckled.