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Ag Markets Continue to Hinge on Hotter Weather Forecasts

Drought and storm damage has likely limited both corn and soybean production and the potential for record crops

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2020 Crop Tour National Results

  • ProFarmer forecast the corn crop at 14,820 million bushels with an average national yield of 177.5 bushels per acre.
  • The corn forecast is below the latest USDA figure of 181.8 bushels per acre, but would be the second largest corn crop on record.
  • The US bean crop was projected to yield 52.5 bushels per acre, with total production of 4,362 million bushels.
  • If the projection is met it would be the third largest bean crop produced, but come in below the last USDA projected yield of 53.3 bushels per acre.
  • ProFarmer’s US corn forecast has been lower than the September USDA forecast in 14 of the last 18 years.
  • In 11 of 18 years,the tour’s soybean projection has been below USDA’s September projection.

FBN’s Take On What It Means: Drought and storm damage has likely limited both corn and soybean production and the potential for record crops. However, the ProFarmer crop tour forecasts have been fairly consistent in underestimating the USDA, which will provide its next forecast on September 11. Despite the forecasts for lower production, there are no shortages of corn or soybeans expected, and farmers should be taking the opportunity to catch up on sales on this rally.

China Imports Record Pork Volume

  • China’s July pork imports were a record 430,000 tonnes, up 136% from the same month last year.
  • The previous record of 400,000 tonnes was first hit in April, then reached again in June.
  • Pork imports this year through July have reached 2.6 million tonnes, up from just over 1 million tonnes a year ago.
  • Beef imports were 210,000 tonnes in July, with shipments for the first seven months reaching 1.2 million tonnes.
  • China has asked packing plants to suspend shipments if they experience coronavirus cases among workers.

FBN’s Take On What It Means: China is expected to continue importing large volumes of meat to fill a large domestic supply shortage after an epidemic of African swine fever reduced the pig herd by an estimated 40%. Tough new checks for coronavirus contamination have slowed clearing at ports, but will not stem the tide of imports needed to satisfy demand. US total pork exports for the year to date are up 50% from last year through the same period, and will likely remain elevated as China’s herd rebuilding efforts continue.

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