Crop review for December 2020

Farmer Standing in a Field

Grain bids surged throughout December. Overseas feed demand, the worker strike in Argentina, and weather conditions in South America were significant factors in soybean and corn prices gaining so much ground. Dry conditions in key growing areas in South America have put yield potential into question, however, the true range of crop loss is still unknown. The pork industry in China has been strengthening, in turn increasing feed needs. Corn prices found their highest level in 6 ½ years, putting pressure on feed costs. The Argentine strike concluded during the final week of December.

The latest drought map was released on December 31, showing nearly half of the state being impacted by some level of drought. The majority of the affected area is in the northern half of the state. Nationwide, about 66 percent is affected by some level of drought.

This month’s WASDE report was released on December 10. U.S. corn supply and projected use was unchanged from November’s report. Estimated 2019/20 area planted and harvested were reported at 89.7 and 81.3 million acres, respectively. Corn yield was estimated at 167.5 bushels per acre. The projected numbers for 2020/21 for planted and harvested areas were 91 and 82.5 million acres, respectively. For U.S. soybeans, the area planted and harvested for 2019/20 were estimated at 76.1 and 74.9 million acres, respectively. The projected areas for 2020/21 were 83.1 and 82.3 million acres, respectively. The 2019/20 estimated areas for wheat were 45.5 and 37.4 million acres, for planted and harvested areas, respectively. The 2020/21 projected wheat planted and harvested acres were at 44.3 and 36.7 million acres, respectively.

Looking back through the year, grain bids had a noticeable dip during the summer months, which is consistent with normal conditions. However, there was a steady increase in value throughout harvest and to the end of the year as demand increased. The Missouri average bids for soybeans, corn, and wheat in January 2020 were 9.16, 3.94, and 5.79, respectively. The yearly average bids statewide for soybeans, corn, and wheat were 9.51, 3.68, and 5.49, respectively.