Soybean growers across Iowa were treated to a supply-bearish crop production report on August 12, thanks to sustained friendly weather and a lack of insect or disease pressure this growing season.
Here in Iowa, USDA estimates average bean yield at 50 bushels per acre, with total statewide production at 502 million bushels. Nationally, yield is projected at a record 45.4 bushels per acre with record production of 3.82 billion bushels.
Iowa Soybean Association Director of Marketing Grant Kimberley says that means profit opportunities on this year's crop are below the cost of production for many producers. But he also points out that the remedy for low prices is low prices.
He says, "You may not see a big change in overall production for this first year, but in places like South America and even here in the U.S. where growers are not going to be able to have very good profit opportunities they may start cutting production. Especially in places like South America. So if you keep prices depressed for too long, then certainly then you'll have a supply response eventually but it does take some time and in the short term here I think we're going to look at demand as being what we're going to be relying on."
Kimberley says the yield figure might change, depending on timely rains through September and no early frost. But he says record precipitation throughout June also brings the final yield figure into question.
"In the past we've never achieved above trend line yields when we've had above normal precipitation in the month of June. And so we certainly had above normal precipitation this past June, record precipitation in some places." He says, "And so that can impact itself with soybeans when it comes to soybean diseases that can manifest itself late in the growing season. and can impact yields we certainly I think are going to have at least average and above average or probably near average yields. But it's yet to be seen based off of the last month here of weather."