Focus on Ag: Latest USDA report decreases 2022 crop yield projections

Kent Thiesse
Farm Management Analyst
Kent Thiesse

The U.S. Department of Agriculture's Sept. 12 crop report decreased the projected U.S. average corn and soybean yields for 2022, as compared to the August National Ag Statistics Service (NASS) yield estimates.

The latest NASS yield estimates were based on U.S. crop conditions as of Sept. 1st; and were the first 2022 yield USDA estimates that included actual field data, including in some of states with major impacts from this year’s drought. Total U.S. corn and soybean harvested acreage totals were also decreased in the latest USDA report, compared to the August acreage estimates.

The result was a 3% decrease in the projected total 2022 production of both corn and soybeans in the United States. The immediate market response was a sharp increase in prices for both December corn futures and November soybean futures on the Chicago Mercantile Exchange (CME).

The Sept. 12 USDA Report projects the 2022 U.S. average corn yield at 172.5 bushels per acre, which is a decline from 175.4 bushels per acre in the August NASS report. The projected 2022 national corn yield compares to the record U.S. corn yield of 177 bushels per acre in 2021, as well as to 171.4 bushels per acre in 2020, 167.4 bushels per acre in 2019, and 176.4 bushels per acre in 2018.

USDA reduced the total 2022 harvested corn acreage in the U.S. by 900,000 acres from earlier estimates, based on crop acreage certification data filed by producers through the USDA Farm Service Agency (FSA) offices. USDA is now estimating total U.S. corn production for 2022 at 13.94 billion bushels, which would be a decrease of 8% from the 2021 production of 15.1 billion bushels, as well as being lower than the 2020 corn production level of 14.1 billion bushels.

USDA is estimating Minnesota’s 2022 average corn yield at 190 bushels per acre, which was a decrease of 3 bushels per acre from the August estimate. The projected 2022 corn yield would be above the 2021 average yield of 178 bushels per acre; however, it would trail the 2020 statewide average yield of 192 bushels per acre and the record Minnesota yield of 194 bushels per acre in 2017.

The Sept. 12 report also decreased Iowa’s 2022 average corn yield by 5 bushels per acre compared to the August estimate, lowering the projected yield to 200 bushels per acre. Iowa’s projected 2022 statewide corn yield would be below the record corn yield of 205 bushels per acre in 2021 but would be slightly above the 2019 statewide corn yield of 198 bushels per acre. The 2022 Iowa corn yield would be considerably higher than the 2020 yield of 178 bushels per acre that was reduced by the severe derecho storm.

The 2022 USDA corn yield estimates for the other major corn producing states are Illinois at 204 bushels per acre, compared to 202 bushels per acre in 2021; Indiana at 186 bushels per acre, compared to 195 bushels per acre in 2021; North Dakota at 141 bushels per acre, compared to 105 bushels per acre in 2021; and Wisconsin at 183 bushels per acre, compared to 180 bushels per acre in 2021. In states being significantly impacted by drought conditions this year, South Dakota’s projected 2022 corn yield is 138 bushels per acre, compared to 135 bushels per acre in 2021; and Nebraska at 176 bushels per acre, compared to 195 bushels per acre in 2021.

The USDA Report on Sept. 12 estimated total 2022 U.S. soybean production at nearly 4.38 billion bushels, which would be down slightly from the 2021 soybean production of just over 4.43 billion bushels. USDA lowered the projected the 2022 U.S. average soybean yield to 50.5 bushels per acre, compared to 51.9 bushels per acre in the August report. The 2022 NASS soybean yield estimate compares to 51.4 bushels per acre in 2021, 50.2 bushels per acre in 2020, 47.4 bushels per acre in 2019, and 51.6 bushels per acre in 2018, as well as the record national average soybean yield of 52 bushels per acre in 2016. The USDA 2022 soybean yield projection about one bushel per acre lower than the average yield estimates by many grain trading analysts.

USDA is estimating Minnesota’s 2022 average soybean yield at 50 bushels per acre, which is the same as the August estimate. The 2022 yield compares to recent statewide yields of 47 bushels per acre in 2021, 49 bushels per acre in 2020, 44 bushels per acre in 2019, and 50.5 bushels per acre in 2018, as well as the record state

soybean yield of 52.5 bushels per acre in 2016. The estimated 2022 soybean yield for Iowa was increased by 1 bushel per acre from the August estimate and is now projected at 59 bushels per acre. The 2022 statewide yield compares to the statewide record soybean yield of 62 bushels per acre in 2021, 53 bushels per acre in 2020, 55 bushels per acre in 2019, and 57 bushels per acre in 2018.

Other projected 2022 yields in major soybean producing states include Illinois at 64 bushels per acre, which is the same as 2021; Indiana at 60 bushels per acre, compared to 59 bushels per acre in 2021; Wisconsin at 53 bushels per acre, compared 55 bushels per acre in 2021, and South Dakota at 41 bushels per acre, compared to 40 bushels per acre in 2021. North Dakota is projected to have a 2022 soybean yield of 34 bushels per acre, compared to only 25.5 bushels per acre in 2021. On the other hand, the statewide 2022 soybean yield estimate for the drought-stricken state of Nebraska is only 52 bushels per acre, compared to 63 bushels per acre in 2021.

Looking at the WASDE report

The USDA World Supply and Demand Estimates (WASDE) that was also released on Sept. 12 included the projected decreases in the 2022 U.S. corn yield and the total corn production. The report also showed a decrease in expected corn usage for ethanol and livestock feed during 2022-23 marketing year, as compared to the 2021-22 corn usage in both categories. U.S. corn export levels for 2022-2023 are expected to decline from a year earlier and are now estimated at 2.275 billion bushels, which is down from the corn export totals of 2.475 billion bushels in 2021-22 and 2.745 billion bushels in 2020-21; however, the 2022-23 export levels are still well above the 2019 final corn exports of 1.777 billion bushels.

Total corn usage for 2022-23 is now estimated at 14.275 billion bushels and corn ending stocks are projected at just under 1.22 billion bushels, which is a decrease from a carryover of slightly of 1.39 billion bushels in the August WASDE report. The latest 2022-23 corn ending stocks projection compares to the ending stocks estimate of 1.52 billion bushels in the just completed 2021-22 marketing year, and 1.23 billion bushels in 2020-21. The USDA 2022-2023 corn carryover level was very near the average estimates by grain trading analysts.

USDA is projecting the average on-farm corn price for the 2022-23 marketing year, which extends from Sept. 1, 2022, through August 31, 2023, to be $6.75 per bushel, which is an increase of $.10 per bushel from the August price estimate. The 2021-22 national average corn price, which will be finalized on Sept. 30, 2022, is estimated at $5.95 per bushel, which compares to previous national average prices of $4.53 per bushel in 2020-21, $3.56 per bushel in 2019-20, $3.61 per bushel for 2018-19, and 3.36 per bushel in 2017-18.

The recent WASDE report projected 2022-23 soybean ending stocks at 200 million bushels, which is a decrease of 45 million bushels or 18% from the August estimate. The 2022-23 soybean ending stocks compares to previous ending stocks of 240 million bushels in 2021-22, 257 million bushels in 2020-21, 525 million bushels in 2019-20 and 909 million bushels in 2018-19. Soybean exports for 2022-23 are projected at just under 2.1 billion bushels, which is down slightly from an estimated 2.14 billion bushels in 2021-22 and 2.27 billion bushels in 2020-21 but is still well-above the 2019-20 export level of 1.68 billion bushels.

USDA is now projecting the average on-farm soybean price for the 2022-23 marketing year at $14.35 per bushel, which is unchanged from August price estimate. The 2021-22 estimated final national average soybean price is estimated at $13.30 per bushel, which compares to national average prices of $10.80 per bushel for 2020-21, $8.57 per bushel for 2019-20, and $8.48 per bushel in 2018-19.

For additional information contact Kent Thiesse, farm management analyst and senior vice president, MinnStar Bank, Lake Crystal, Minn., at 507-381-7960 or kent.thiesse@minnstarbank.com.