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The Bin Buster U.S. Crop of 2007
17 Jul 07
The dramatic shift in crop acreage from soybeans and cotton into corn during the spring of 2007 will test the limits of existing grain storage.
With USDA's June "Acreage" report, the largest corn crop on record appears to be on its way. USDA reported planted acres of 92.9 million acres up 14.6 million acres from 2006. At the same time, soybean acreage planted declined 11.4 million acres from 2006. In Thursday’s WASDE report, the USDA estimated the size of the corn crop at 12.8 billion bushels with a yield of 150.3 bushels per acre. Yield models that utilize current crop conditions to predict final yields suggest the corn yields may even reach as high as 154 bushels per acre even after accounting for drought in the southeast United States, as well as the northern and eastern edges of the Corn Belt. This suggests a corn crop size of 13.3 billion bushels, up from 10.5 billion bushels in 2006. While soybean production is expected to fall from 3.2 to 2.7 billion bushels in 2007 (using a 43 bu/acre yield projection from current crop condition models), the net change in the volume of corn and soybean production is 2.3 billion bushels. Combined with a 0.3 billion bushel larger wheat crop, farmers will be producing 2.6 billion bushels more grain in 2007 than 2006, placing pressure on storage capacity.Utilizing data for corn, soybean, and wheat production in 2006 and estimates for 2007, a cursory analysis suggests that there are likely to be storage challenges this fall. State-level estimates for crop production and available storage capacity, the two darkest regions in the map below, illustrate the areas that will likely experience shortage pressures where their storage to production ratios are less than one. Other areas may also experience pressure since they may produce other crops such as sorghum that are not included in these ratios. As expected, many states in the Corn Belt will likely be stacking grain on the ground in 2007. But new pressures are also likely to be felt in the Delta with increased corn production where weather conditions may not be as friendly to storage on the ground. The drought conditions in southeast United States, north and eastern Corn Belt are expected to weaken corn yields so that storage will not be as large a problem in this areas. 
By John Kruse
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