The U. S. Department of Agriculture’s latest estimate for corn and soybean yields was disappointing for Iowa farmers, and concerning for Iowa’s cash-strapped state government budget.
Grain traders and market analysts had been expecting the yield estimates to be lowered because of persistent dry weather. But, USDA increased projected fall harvest for corn and soybeans Tuesday by about one-half bushel per acre. That sent grains markets sliding.
“I think you have to say that, as of right now, the genetics have overcome adverse weather conditions,” said Don Roose, President of U.S. Commodities in West Des Moines.
Ordinarily, larger harvests would mean more revenue. But grain markets are already depressed by ample supplies of corn and soybeans. Iowa farmers are facing market prices that hardly pays for production costs. Many sell grain for less than break-even prices.
“I think it’s a situation where it’s going to be a little bit disappointing versus last year when we had tremendous yields and a price that was a little bit higher,” Roose said.