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July 25, 2012

2012 U.S. Corn Harvested Acreage Reduced to 84.0 Million Acres

Corn -One of the results of this unrelenting heat and dryness is that the crop abandonment will be much greater than normal and more corn acres will be needed for silage this year. In the latest WASDE report, the USDA estimated that 92.2% of the planted corn would be harvested for grain. In a normal year, that might be an acceptable figure, but not this year.

The abandonment occurring in the field is hard to assess just like it is when ponding occurs. There will be some entire fields that will not be harvested, but that will be the exception and not the rule. What is more likely to occur is that on the hilltops, or on the lighter soils, in the corners or end-rows there are going to be patches where there will be nothing to harvest. These patches of abandoned crops make it very difficult to summarize the total amount of abandonment.

Currently, the USDA is estimating that 7.5 million acres of corn will not be harvested for grain with the vast majority of those 7.5 million acres being harvested for silage. The number of acres used for silage is going to increase greatly this year due to how small the corn plants are in many areas. I saw corn in Nebraska already being cut for silage which is a month earlier than normal and the farmers were cutting the corn in order to salvage some of the crop before it gets worse. The weekly state reports indicated the corn is being cut for silage, hay, or forage all across the Corn Belt and this trend will accelerate this week. The number of corn acres harvested for silage this year could be as high as 10 million acres.

Currently, the USDA is estimating that 7.8% of the corn will not be harvested for grain and in 1988, 14% was not harvested for grain. Due to the widespread nature of the drought this year, the 2012 corn harvested acreage is being reduced to 84.0 million acres, which means that 13% of the corn will not be harvested for grain. The only reason why I did not make it as bad as 1988 is because the corn hybrids today are better suited to tolerate dry conditions than the hybrids that were used in 1988.

Soybeans - For the soybean crop, the situation is not as dire as it is for the corn, at least not yet. Soybeans require much less water compared to corn so they are better able to tolerate dry conditions, at least during the first half of the growing season. The soybean's peak water demand is just now starting as the pods start to fill.

The 2012 soybean harvested acreage is going to be smaller than what the USDA is currently estimating (75.3 million acres) due to less double crop soybeans being planted and more abandonment. The drought has been the worst where much of anticipated increase in double crop soybean acres was expected. As a result, many of those anticipated double crop acres were not planted.

Additionally, there is also going to be a much higher level of soybean abandonment this year. I saw many fields in the western Corn Belt where the soybeans are extremely small and if these fields do not receive significant rainfall within the next week or two, the plants will be too small to harvest. Many of these extremely small soybeans are on the verge of dying and there are patches in the fields where they have already died. The worse soybeans are found on the hilltops, hillsides, and in areas where the soils are lighter.

As a result, the soybean harvested acreage has been lowered an additional 500,000 this week to 73.3 million acres. That now puts the crop at 2 million acres less than what was estimated in the June Acreage Report (75.3 million acres).