U.S. soybean production is now forecast at 4.38 billion bushels, down 3 percent from the previous forecast and down 1 percent from 2021, according to the latest USDA crop production report, which was released Sept. 12. That news helped give a boost to soybean prices.
Based on conditions as of Sept. 1, soybean yields are expected to average 50.5 bushels per acre, down 1.4 bushels from the previous forecast and down 0.9 bushel from 2021.
Total planted area, at 87.5 million acres, is down 1 percent from the previous estimate but up less than 1 percent from the previous year. USDA also forecast area harvested for beans in the U.S. at 86.6 million acres, down 1 percent from the previous forecast, but up less than 1 percent from 2021. Acreage updates were made in several states based on a review of all available data.
Local prices had been down a little bit, but they had risen slightly in advance of the report. Prior to the release of the USDA report, Jensen said the futures market prices were over $14. At one local elevator in west central Minnesota regularly followed in this column, as of Sept. 12, cash soybean prices for September delivery were posted at $14.53 and basis was -35 cents under. The December futures price was $14.92 and basis was +74 cents over.
“If you're a farmer out there today and you’re looking at what (you) should sell, soybeans are probably the thing to deliver off the combine,” she said. “If you have corn, if you have soybeans, soybeans should be the thing you deliver (off the combine). Basis is strong. We’re looking at historically strong basis numbers across our area.
“Cash beans today are $13.80, and if you look down the road, the price is almost the same,” she continued (prior to the report). “There really isn’t a carrying charge. Basis really doesn’t change, so you probably do want to deliver soybeans off the combine if you’re going to deliver anything off the combine.
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“If you need money for cash flow, you need to make some payments, you don’t have enough storage, soybeans would be the first thing that I would deliver,” she added.
Another concern in the market relates to soybean export sales and the fact USDA is not releasing weekly export data at this time.
“We do have some concerns about soybean exports. We’ve got to have China buy, buy, buy…but their economy is slowing down, and, just to throw a little fuel on the fire, USDA is no longer releasing weekly export sales information because they’re having computer problems, apparently,” Jensen said.
“In a market like soybeans, which is so dependent on export sales, it’s important to have that information,” she continued, adding USDA will still provide updated supply and demand numbers, including export sales, in the monthly WASDE report (World Agricultural Supply and Demand Estimate).
“But we’re not getting the weekly report like we used to,” she added. “In the soybean market right now, that’s very challenging because we all want to see what the heck China is doing. Are they continuing to buy? Is their economy slowing down? Is our strong dollar really hurting soybeans as bad as we think it might be? So demand is really a huge issue right now in soybeans. Demand has really jumped to the forefront at this time in the soybean market.”
On the flip side, for corn or beans, October is usually when USDA makes acreage estimates, but the agency announced it was making the acreage announcement Sept. 12 because it was able to get all the numbers put in place.
“On one hand, their computer system is getting the acreage number out a month early, but on the other hand, we don’t know what export sales are. For a crop that’s so reliant on exports, missing those weekly reports is a big deal,” she noted.
“We don’t have a bumper crop for corn or soybeans. If we had better handle on demand, I think this could be a really bullish market because we don’t have a record crop,” she added. “We know there’s a short crop, but we don’t know how much of it is going to go to China. So it’s very unnerving at this time. I didn’t realize how much I enjoyed those weekly sales reports until they were taken away.”