As trade disputes eroded major markets for American soybeans, U.S. producers grew more of the crop than ever before, according to Department of Agriculture data released Friday.
According to USDA’s 2018 crop production summary, 4.54 billion bushels of soybeans were produced in 2018, a record amount that comes in 3 percent over 2017’s harvest. The record production was grown on fewer acres (down 2 percent from 2017) but with a higher yield (an average of 51.6 average bushels per acre, up 2.3 bushels from 2017).
The record crop comes at a time when soybean exports have lagged due to the Trump administration’s trade dispute with China. Exporters struggled to move product through the Pacific Northwest, stalling soybeans produced west of Minnesota that typically would have headed for China. Soybean producers also received the largest per-bushel payment through USDA’s Market Facilitation Program ($1.65 per bushel) as compensation for tariffs. Analysts predict producers will plant fewer acres of the crop this year.
Also today, USDA released the February World Agriculture Supply and Demand Estimates, which noted soybean ending stocks at 910 million bushels. However, those stocks could move in a hurry, Allendale Inc. President Steve Georgy said in an interview with Agri-Pulse.
“That can all be changed in one swoop of a pencil here with what happens with China,” Georgy said, pointing to potential tariff reduction or elimination as a result of a deal between the U.S. and China. “Even though some of these numbers came out with no major surprises to move (the market), our focus is still going to be on what happens with trade.”
USDA also reported 14.4 billion bushels of corn from U.S. producers in 2018, down slightly from the anticipated figures released in 2017. Average yield and area harvested for grain took a slight drop from 2017 estimates. Sorghum and cotton production were also seen higher, but cotton production is expected to take a 12 percent drop from 2017’s figures.
Overall, Georgy said the reports – which came in highly anticipated due to the lag in USDA data created by the government shutdown – didn’t move the markets too much.
“There really is no excitement being generated from the numbers we currently have,” he said.
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