The harvest of the troubled 2019 season begins in parts of the US Midwest. With 7% of the area harvested, it is not yet possible to evaluate potential yields and results. But undoubtedly the crop will clear all doubts about the yield of this crop by comparing the most modest estimates by consultants and brokers with the most optimistic data from USDA.
While the market tries to find a big variable to support prices in the midst of the US pre-harvest, there is a quarterly stocks report to be released by USDA this Monday, the 30th. These figures are important because they set the previous crop’s carryover stocks and the beginning stocks of the new crop. The market’s estimates are high. USDA has estimated 62 million tons for last year’s final stocks, and the market now believes in 63.5 million tons. That is, super stocks that neutralize any variable that might bring any new cut in production for this 2019 crop to be reaped this October.
The USDA’s expected yield is 168.2 bushels per acre, which creates a production potential of 350 million tons. Private estimates have been, since the planting, far below the USDA’s expectations. Some even pointed to potentials below 160 bushels/acre. Now, with the harvest beginning and expected to move forward more rapidly in October, the market will be able to better evaluate the results and confront the official estimates again. It will be a good test for the market and its crop research concepts, which are far from the USDA’s projections this year.