Livestock Marketing Information Center (LMIC) Staff
On August 11th, USDA-NASS lowered their 2011 crop production forecasts for major feedstuffs and the WAOB raised USDA’s price forecasts. The estimated national average corn yield was reduced to 153 bushels per acre, a decline of nearly 6 bushels from the month-earlier forecast and below industry expectations. The national average sorghum yield was reduced by nearly 11 bushels per acre compared to one month ago, due to drought in the Southern Plains. For soybeans, the national yield was reduced by 2 bushels per acre over the last month.
USDA-WAOB raised their national average corn price for the 2011-12 crop marketing year dramatically to a record-high range of $6.20 to $7.20 per bushel, an increase of 70 cents per bushel. Sorghum prices were raised by 90 cents per bushel and soybean meal was increased by $10.00 per ton (national price range of $355.00 to $385.00 per ton). By-product feedstuff costs, like dried distillers grain and cottonseed, will continue to be very expensive too. In fact, some regions that traditionally feed cottonseed meal to livestock may switch to less expensive soybean meal; U.S. cotton acreage harvested was reduced by USDA to reflect expected abandonment at 30% of plantings due to drought.
USDA-NASS indicated large hay production reductions in the latest Crop Production report. For example, hay production this year in Texas now looks to be about half of 2010’s. Nationally, alfalfa hay production will be down at least 4% compared to 2010’s. Drought is mostly reducing other hay production. USDA estimated other hay production this year will be 14% or 10.7 million tons below a year ago. According to LMIC forecasts, hay prices nationally will be record high this year, with all types of hay averaging about 50% above a year ago.