2021 US Corn & Soybean Output

Market Analysis

As the commodity markets end 2021, the current focus is on South America’s weather on the size of their crops and the omicron variant’s impact on the ongoing COVID pandemic across the world. However, the upcoming final US row crop levels for 2021/22 season being released in January 12 will be important to grain and oilseed prices. The changes aren’t expected to be large, but slight declines in corn (CORN) and soybeans (SOYB) supplies could occur like previous years.

Last year’s building La Nina weather pattern that began west of the Mississippi River last spring and significantly impacted the N Plains crop prospects by summer was 2021’s major crop headline. A heavy bout of rains in the ECB ahead of pollination caused some drown outs, but August rains were beneficial to WCB crops this year. Despite Hurricane Ida’s impact on the Mid-South, this year’s plentiful rains were positive for most SE US crops. After corn’s US yield forecast in August started at 174.6 bu, it rose 2.6 bu by November. However, the US corn yield average has decline 6 of the last 8 years on the Jan report with 2020 down 3.6 bu. We expect a 0.6 bu lower final yield producing a 52 million bu smaller 2021 US corn crop.

In soybeans, 2021’s growing season was also impacted by the La Nina weather pattern that reduced rainfall across the Midwest beginning last spring with the N Plains particularly hard-hit prompting switches to more oilseeds. However, better rains in the Eastern US this past summer created a dichotomy between the two areas yield prospects. Last fall’s harvest weather also created a fast dry down of soybean’s harvest moisture again this year. With soybean’s final yield dipping 5 of the last 6 years, 2021’s yield could decline another 0.2 bu. to 51.0 bu level dropping this year’s crop size by 20 million to 4.405 billion bu.

After last fall’s Small Grains Report, no change in the total US wheat crop or its various varieties are likely on the upcoming January 12 production report. The USDA’s US winter wheat seedings update will probably be the main market factor for this food grain that day (WEAT).

What’s Ahead:

The USDA’s final major US crop sizes are always important to the markets. However, S. America’s weather impact on its crops & the economic issues of expanding COVID pandemic are the current price factors.

With La Nina already hurting Parana and Rio Grande crop prospects and indications that its hot and dry conditions will build into Argentina, S America’s crop outputs will remain a price focus.

Hold Sales.

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