FOCUS ON AG
August 29, 2022
2022 CROP YIELD EXPECTATIONS ARE QUITE VARIABLE
August is typically the month of the year when we get the first producer survey yield estimates from USDA, as well as yield projections from major private forms. This yield data is gathered in a number of formats from producer surveys to crop tours to satellite technology. There is not necessarily a method that has proven more accurate than any other, as all methods have some strengths as well as some limitations. The one consistency being echoed by most crop experts is that the 2022 crop yields are likely to be highly variable and are very difficult to predict, especially in drought impacted areas of Western Iowa, Nebraska, and South Dakota. Most of the crop information in these estimates was based on crop conditions in early-to-mid August, so any major changes in conditions after that timeframe could alter final State or national yield numbers.
The statewide and national corn and soybean yield estimates in the USDA Crop Report that was released on August 12, 2022, were based on crop conditions as of August 1. The USDA report was based on a survey of over 15,000 crop producers from across the United States that was conducted National Ag Statistics Service (NASS). The next USDA Crop Report will be released on September 12 and will be based on crop conditions as of September 1. This report will include actual field survey data in the yield and production estimates.
Two of the main private firms that release crop yield and production estimates during August use different technology to arrive at their projections. The “Pro Farmer Crop Tour” is quite well established and has been around for several decades. Pro Farmer Tour gathers “in-person” field yield data from the primary corn and soybean production areas in seven States during the third or fourth week of August, which is then adjusted for crop maturity and historical differences between tour data and final yield numbers. Yield adjustments are also made in made in States that have unique conditions in certain areas of a State, such as drought conditions in Iowa, Nebraska, and South Dakota, irrigation in Nebraska, geographical differences in States like Minnesota.
For the past five years, DTN has partnered with the Gro Intelligence (GroIntel) firm to conduct a “digital yield tour” of the primary corn and soybean production areas in the United States. DTN derived their yield estimates from GroIntel, utilizing satellite imagery taken during the second week of August, which is then adjusted based on actual rainfall amounts and temperature data, as well as for the drought index. The GroIntel national and State yield data will continue to be updated into September.
Nationally, corn yield estimates were Pro Farmer at 168.1 bushels per acre and DTN GroIntel at 167.2 bushels per acre, compared the NASS yield estimate in the August 12 USDA Crop Report of 175.4 bushel per acre. All of the 2022 corn yield projections would fall short of last year’s record average U.S. corn yield of 177 bushels per acre. With the Pro Farmer and DTN GroIntel 2022 corn yield estimates being considerably lower than the 2021 national average corn yield. The 2022 national corn yield projections compare to other recent final average U.S. corn yields on 172 bushels per acre in 2020, 167.4 bushels per acre in 2019, 176.4 bushels per acre in 2018, and 176.6 bushels per acre in 2017.
The national yield differences between the USDA corn yield estimate (175.4 bu./acre) and the “Pro Farmer” projection (168.1 bu./acre) may not seem significant; however, that could potentially represent a large difference in the final total 2022 U.S. corn production level, which could impact grain market prices in the coming months. The current difference between the corn yield estimates by USDA and “Pro Farmer” is 7.3 bushels per acre. Based on the USDA estimate of 81.8 million harvested acres of corn in the U.S. in 2022, that yield difference represents over 603 million bushels of corn. The 2022-23 U.S. corn ending stocks are currently estimated at just under 1.4 billion bushels, so a production decline of that level would potentially reduce corn carryout by 43 percent.
Generally, the state-by-state average corn yield estimates released by USDA in the August 12 Crop Report were higher than the yield projections released from the other crop tours and surveys. For example, USDA estimated Iowa’s 2022 crop yield at 205 bushels per acre, compared to yield estimates of 198 bushels per acre by Pro Farmer and 180 by DTN GroIntel. The private company corn yield projections for Nebraska and South Dakota were also much lower than the USDA yield projections that were based on crop conditions in early August, as compared to later in the month when drought conditions had intensified in some areas. Corn yield projections for the current growing season were much more consistent in States such as Minnesota, Illinois, Indiana, and Wisconsin.
NASS estimated the 2022 U.S. national average soybean yield at 51.9 bushels per acre in the August 12 USDA Crop Report. This compares to national soybean yield estimates of 51.7 bushels per acre by Pro Farmer and 48.9 bushels per acre by DTN GroIntel. The USDA 2022 yield estimate would potentially tie the record national average soybean yield of 51.9 bushels per acre in 2016. Other recent national soybean average yields were 51.4 bushels per acre in 2021, 50.5 bushels per acre in 2020, 47.4 bushels per acre in 2019, 51.6 bushels per acre in 2018, and 49.1 bushels per acre in 2017. Overall, the various state-by-state soybean yield projections appeared to be a bit more consistent than the corn estimates were. Once again, the drought conditions that have developed in the Western Corn Belt late in the 2022 growing season may have a large impact on final yields in some States.
Based on the August 22nd USDA Crop Progress Report, 55 percent of the corn crop in the U.S. rated “good-to-excellent”, which compares to a “good-to-excellent” rating of 60 percent at this point in 2021. The higher crop ratings for corn dropped by two percent from the crop report issued a week earlier on August 15. The highest statewide “good-to-excellent” ratings were Wisconsin at 77 percent, Illinois at 70 percent, North Dakota at 68 percent, Minnesota at 67 percent, and Iowa at 66 percent. The lowest “good-to-excellent” corn ratings were in Nebraska at 42 percent and South Dakota at 48 percent. Nebraska had 32 percent of the corn acres listed as “poor-to-very poor”, with Ohio at 23 percent and South Dakota at 22 percent in the lower categories.
The weekly USDA crop ratings on August 22 listed 57 percent of the U.S. soybean crop as “good-to-excellent”, which was down from 58 percent a week earlier on August 15. A year ago, 56 percent of the U.S. soybean crop was rated “good-to-excellent” in late August. The Midwest States with the greatest percent of soybean acreage in the higher categories were very similar to corn, with Wisconsin leading the way at 78 percent, followed by Illinois at 68 percent, Minnesota at 67 percent, and Iowa at 62 percent. The soybean “good-to-excellent” ratings in other States included Ohio at 59 percent and North Dakota at 57 percent, with South Dakota and Indiana both at 55 percent. The lowest “good-to-excellent” rating in the Midwest was Nebraska at 46 percent, which also showed 22 percent in the “poor and “very poor” categories.
Many crop advisors point out that the 2022 national and statewide average corn and soybean yields are very hard to predict, due to the wide variability in crop conditions across the region. Many of the portions of the western Corn Belt have been hard-hit by worsening drought conditions during late July and August, which could impact final statewide corn and soybean yield results. Other areas of the Midwest have started to receive more frequent rainfall events during August, which could help boost final yield results. Corn and soybeans in potions of Minnesota, North and South Dakota, and Wisconsin were planted much later than normal this past Spring, so any type of widespread early frost event during the first three weeks of September could potentially impact final 2022 corn and soybean yield results in those States.
(NOTE — Please refer to the attached table for USDA National and Statewide corn and soybean yield estimates for 2022 from USDA, Pro Farmer and DTN Gro Intelligence (GroIntel).), as well as final 2021 USDA yields.
Note — For additional information contact Kent Thiesse, Farm Management Analyst and Sr. Vice President, MinnStar Bank, Lake Crystal, MN. (Phone — (507) 381-7960) E-mail — email@example.com) Web Site — http://www.minnstarbank.com/