Fall harvest continues across the countryside for the majority of principal crops. According to USDA-National Agricultural Statistics Service’s Crop Progress report, as of Oct. 24, farmers in 18 states that cover 96% of 2020 U.S. soybean acres have harvested 73% of soybean planted acres, which is less than the 82% reported at the same time in 2020, but ahead of the five-year average of 70% reported at this same point from 2016 through 2020. Leading the way is Minnesota, which has reported 95% of soybean acres harvested, behind the 98% reported in 2020. South Dakota has the second-highest reported rate, 93%, which is in line with this time in 2020, when 94% of soybean acres had been reported harvested. North Dakota reported 91% of soybean planted acres have been harvested as of Oct. 24, which is behind the 2020 reported amount of 96% of soybean planted acres harvested.
The 2021 soybean harvest yield expectations, as reported in USDA’s October World Agricultural Supply and Demand Estimates, increased marginally with a yield bump from 50.6 bushels per acre in September to 51.5 bushels per acre in October, which is slightly up from analysts’ expectations that soybean yield would be closer to 51.1 bushels per acre. The yield increase pushes production expectations for this year’s soybean crop to 4.45 billion bushels, up 5.5% compared to 2020. If that size crop comes to fruition, it will be the U.S.’ largest soybean crop on record.
For corn planted acres, USDA-NASS reports as of Oct. 24, farmers in 18 states that cover 94% of the 2020 U.S. corn acres have harvested 66% of the 2021 corn planted acres thus far, which is 13% higher than the amount famers harvested on average from the previous five years at this same point in time, but behind the 70% reported at the same time in 2020. Leading the way is North Carolina, which reports that 96% of corn planted acres have been harvested, just above the 95% reported at this point in the season in 2020. Texas follows, reporting 94% of corn planted acres harvested, which is higher than the 88% of corn acres that had been harvested up to this same point in time in 2020. Tennessee has reported the third-highest amount of harvested corn planted acres, reporting 86% as of Oct. 24, which is just behind the 90% of corn acres harvested reported at this same date in 2020.
USDA’s October WASDE showed a minor increase in yield for the 2021 corn crop, rising from 176.3 bushels per acre in September to 176.5 bushels per acre. Analysts expected corn yields would be revised downward to 176 bushels per acre. The best yield on record is 176.6 bushels per acre, which occurred in 2017.
2022 On the Mind
Despite harvest progress pacing ahead of the five-prior years’ average and yield expectations being better than expected, anecdotally, farmers have said it’s not as good as it sounds. On their minds already is whether or not the quality of crop will be good given the dryer conditions during key growing stages this summer and persistent fall rains pausing harvest in many areas. This is in addition to drought degrading growing conditions most of this year in Western growing regions.
As if farmers need more to worry about, many are reporting concerns regarding rising prices due to inflation and what impacts this will have on the 2022 bottom line. The primary concern centers on ongoing supply chain disruptions, leading to general shortages and price increases. Farmers are most worried about the price of inputs for the 2022 crop year, especially rapidly increasing fertilizer prices. The producer price index for fertilizer materials has increased 160% since the beginning of the COVID-19 pandemic. The current PPI for fertilizer materials, sitting at 348, is the highest since December 2008. Supply factors including increased input and production costs to make fertilizer, transportation costs, natural disaster delays, labor disruptions, manufacturing capacity issues, trade disputes and general distribution interruptions combined with demand factors including increased crop planted acres, increased farm income, weather impacts and global demand shifts have caused a perfect storm for the fertilizer industry, contributing to increased prices and potential challenges for availability.
Takeaway
Before harvest has even come close to an end, farmers are already mulling over the 2022 season. If that seems earlier than usual, it likely is. Concerns with inflation and rising input costs, like fertilizer prices, weigh heavily on farmers’ minds as they work to finish what may be an underwhelming harvest. Concerns that corn and soybean yields will not reach the height of analysts’ and USDA’s expectations and recent weather disruptions have turned some outlooks pessimistic.
