Deadline for Updating Yields for Safety-Net Programs Nears
The USDA Farm Service Agency is reminding farmers of their opportunity to update Price Loss Coverage and Agriculture Risk Coverage yields before September 30, 2020. This is the first opportunity farmers have had to update their yields since 2014. The updated yield will be equal to 90% of the average yield per planted acre in crop years 2013-2017, excluding any year where the applicable covered commodity was not planted and is subject to the ratio obtained by dividing the 2008-2012 average national yield by the 2013-2017 average yield for the covered yield for the covered commodity.

For more information, reference resources and decision tools, visit farmers.gov/arc-plc. Contact your local FSA office for assistance.

Rice
In the September report, USDA raised the 2020 production estimate by 6.9 million cwt to 225 million on increased harvested area. The average yield was down 71 lbs. per acre to 7,529 pounds. Long grain production was raised 9.8 million cwt to 168.9 million, while medium and short grain production was cut 3 million cwt to 56 million. All rice ending stocks for 20/21 were increased to 45.9 million cwt. As a result of those changes to the supply/demand balance sheet, USDA cut the projected season-average price by 10 cents per cwt. to $12.60. Since the report, the November contract has violated the trendline drawn off the July low. The recent high of $12.67 will be though resistance on a rebound, but the market has found support around $12.03 for the time being. Weekly export sales of 78,700 metric tons provided support on Thursday. 

Corn
USDA re-surveyed farmers in Iowa after a derecho resulted in a wide swath of damaged and destroyed crops across the state on August 10. As a result, the corn harvested for grain estimate was lowered by 550,000 acres. Yields are still expected to set a record of 178.5 bushels per acre. That’s down 3.3 bushels from the August report, but up 11.1 bushels from 2019. Harvested acres are now pegged at 83.5 million acres, and total production is pegged at 14.9 billion bushels. The supply/demand report reflected the reduced production, and also a lower corn for ethanol estimate and increased exports. The net result was the ending stocks estimate lowered 253 million bushels from the August report. The projected average on-farm price was raised 40 cents to $3.50/bushel. December futures continue to trend higher. Weekly export sales of 63.4 million bushels were within trade expectations, but still supportive.  

Soybeans
Soybean futures have moved to new contract highs on support from robust exports and decreased production estimates. Weekly exports came in at 90.3 million bushels, and two additional sales were reported on Thursday. Drought and damaging weather resulted in the USDA cutting their projected yield, but maybe not as much as analysts were expecting. The new estimate is 51.9 bushels per acre, down from 53.3 bushels in August. That would still set a new record, but does reflect a 112 million bushel cut in total production, pegging the crop at 4.3 billion bushels.  More active exports in recent weeks have resulted in a decrease in the 20/21 beginning stocks estimate, and crush and exports were unchanged from the previous report. The net result of the report are ending stocks of 460 million bushels, down 150 million from last month, and a 90 cent increase in the projected on-farm price, which is now pegged at $9.25 per bushel.

Cotton
Cotton futures have seen some weakness in recent days as December has found resistance just below 67 cents, despite bullish fundamentals. Weekly export sales of 519,600 bales were the highest total since early June. In the latest reports, USDA lowered the production estimate to 17.1 million bales. That is down 6% from the August report and 14% from 2019. Yields are still projected to set a record high of 910 pounds per harvested acre. The mill use projection for 20/21 was also lower, but still expected to increase 16% from the dismal numbers in 19/20 as COVID decimated demand. Exports and ending stocks were decreased 400,000 bales, reflecting reduced U.S. supply and stronger foreign competition. Ending stocks for 20/21 are currently pegged at 42% of use at 7.2 million bales. The projected season-average price was pegged at 59 cents per pound, unchanged from the August report.

Livestock, Poultry, and Dairy
The forecast for 2020 total red meat and poultry production was lowered from last month as lower pork and broiler production more than offsets higher beef and turkey production. For 2021, the total red meet and poultry forecast is reduced from the previous month on lower expected beef, pork, and broiler production. Beef production was reduced on lower expected slaughter and lighter carcass weights. Pork production was also reduced on lighter expected carcass weights. Broiler production is projected to be reduced on slower growth as the industry adjusts to higher feed costs.

The milk production forecast for 2020 was raised from the previous month on higher growth in milk per cow. The all milk price forecast was lowered to $17.75/cwt. For 2021, the milk production forecast was increased, again on stronger anticipated growth in milk per cow. The all milk price forecast was lowered to $17/cwt for 2021.