Fundamentally Speaking

Collapse in U.S. Corn Output and Yields

Joel Karlin
By  Joel Karlin , DTN Contributing Analyst
Chart by Joel Karlin, DTN Contributing Analyst

USDA yet again issues series of bullish numbers on report day and no question about it, corn saw the most positive news which resulted in priced ending limit up and trading another 8-9 cents higher than that synthetically with March 2021 at $5.25 or thereabouts.

So many positive factors to choose from including far lower December 1, 2020, quarterly stocks than expected linked to very strong feed demand, a greater than anticipated decline in the final 2020/21 carryout figure and most likely contributing to both, the largest November to January USDA corn reductions in terms of both bushels and yield.

This year's drop in output from the November to the December report was 324 million bushels (mb) vs. the trade guess of a mere 60 mb decline.

This is the largest downward revision ever, topping the 286 mb loss from the November 2018 to the January 2019 crop reports.

Meanwhile the 2020 yield was pared from 175.8 to 172.0 bushels per acre (bpa), a 3.8 bpa decline that is also the largest ever, while the trade was just looking for a 0.5 bpa drop.

This graphic shows the USDA November to January 2020 corn revisions for top states and U.S. per bushel change on the left-hand axis and the 2020 percent bushel change and largest percent bushel change from the 1990-2020 period on right hand axis.

Also reported in the yellow circles is the rank of the largest per bushel percent yield declines from the 1990 to 2020 with the number 1 meaning this is the largest November to January corn yield decline in the past 31 years.

As mentioned, the 3.8 bpa decline in the 2020 U.S. corn yield is the largest drop ever from the November to the January report topping the 2.5 bpa reduction two years ago but the decline in percent terms is 2.2% which is the second largest drop in that regard next to the 2.3% fall in the 1993 crop which fell by 2.4 bpa.

This is reflected in the U.S. having a 2 in its yellow circle, the second largest percent decline since 1990.

Note you cannot have a drop in the national corn yield of this magnitude without many of the major producing states also seeing sizable bpa and % bpa declines and 13 of the top 18 states did see yield declines from the November 2019 to the January 2021 crop production reports.

The largest bpa drop was seen in Pennsylvania of 14 bpa but the 9.2% decline is only the third largest percent drop since 1990 with 2018 and 1999 larger.

Wisconsin's 10 bpa decline in percent terms is down 5.4% and that is the largest percent decline since 1990 resulting in the number 1 in the yellow circle.

Texas also had its third largest decline while Iowa, the top corn producer, saw its second largest Nov to Jan decline in percent terms while Michigan, Nebraska and Minnesota had their fourth largest yield percent declines as there were a number of key states that saw big yield declines.


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