By LINDA McGURK
Indiana Correspondent INDIANAPOLIS, Ind. — Market fears that the U.S. corn production couldn’t keep up with demand were at least temporarily soothed as the USDA’s National Agricultural Statistics Service (NASS) released its crop production forecast on Aug. 10, predicting a record harvest both nationally and in Indiana.
“Farmers responded to the higher prices and demand early on and planted more corn,” said Greg Preston, director of the NASS Indiana Field Office, during a crop briefing at the Indiana State Fair in Indianapolis.
If estimates in the report hold true, the 2007 U.S. corn production will reach 13.1 billion bushels, which represents a 24-percent increase from last year. The average yield is projected at 152.8 bushels per acre.
In Indiana, NASS predicts farmers will harvest slightly more than 1 billion bushels of corn this season, up from 844.7 million bushels last year. The state’s average yield is expected to stay at last year’s level of 157 bushels per acre.
“We’re going to see more corn in Indiana than ever before,” said Andy Miller, director of the Indiana State Department of Agriculture.
Miller said he was “somewhat surprised” by the bullish report, considering this year’s growing season has been the seventh driest on record, leaving many farmers fretting over crop stress and reduced yields. Chris Hurt, agricultural economist at Purdue University, echoed that sentiment, but noted that the forecast for some parts of the state is still rather gloomy and will cause individual hardships. “We’ve had a lot of weather stress this year, especially in the eastern part of the state. In East-Central (Indiana) there are concerns about yields and farm income,” he said.
“I call this growing season a West Side Story,” said Preston, referring to the dry conditions that hit Indiana in June and gradually worsened crop stress along the Ohio border, whereas sporadic rains later improved top soil moisture and helped crops recover in the western part of the state.
This east-west drought pattern is reflected in the NASS yield projections for Indiana, which show farmers in West-Central Indiana could enjoy average corn yields of 177 bushels per acre, compared with just 128 bushels per acre in East-Central Indiana.
Preston said he witnessed some of the drought damage first hand, traveling around the state. “Some of the best corn in the western part of the state was twice as tall as the worst corn in the eastern part of the state,” he said.
While the Indiana corn production may break records, the NASS expects the state’s soybean crop to decrease to 215.3 million bushels, down 24 percent from 284 million bushels last year. The state average soybean yield is also expected to drop from 50 bushels per acre in 2006 to 47 this year.
Once again, West Central and North-western Indiana will likely exceed the state average, with a projected soybean yield of 52 bushels per acre, whereas East-Central Indiana may only harvest 39 bushels per acre.
“The name of the game this year is storage,” said Hurt, who expects corn prices to hover in the low $3-range around harvest and increase to $3.60-$3.70 by next spring and early summer.
For soybeans, he expects farmers to receive approximately $8 per bushel around harvest and $9 by the spring.
Corn prices on the Chicago Board of Trade fell as a result of the NASS report, to the delight of Indiana livestock producers, who reduced their herds last year due to $4 corn. Ethanol producers have also been under pressure from high corn prices, and Hurt said the announcements of new Indiana plants seem to have leveled off as a result.
“The outlook (for the ethanol industry) is a little more uncertain than it has been,” he explained. “The break-even point for new plants is now around $3.25-$3.50 (per bushel of corn).”
Even though corn prices may be a little lower this season than what Hoosier grain farmers had hoped for, Hurt said the industry is in good shape overall.
“The Indiana farm sector is probably stronger than it’s been for 50 years and there’s a lot of optimism looking forward,” he said.
This farm news was published in the Aug. 15, 2007 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee. |
