USDA Bumps Corn Planted Area – 07/01/2023

The USDA altered the US corn balance outlook for 2023/2024 by reporting a significant upward revision in corn planted area. The estimate of 94 million acres would be the largest area planted to corn in the US since 2013.

We have worked through the projected new crop US corn balance assuming the larger planted and harvested area. Our national average yield assumption is smaller than USDA assumed last month, as the most recent weekly crop progress data put just 50% of the US crop in good or excellent condition, compared to the 66% average for the same week in the preceding 30+ years.

Weather during the month of July is the most critical in determining corn yields. The bulk of silking will occur over the three weeks when hot weather could diminish corn productivity. Even if July weather proves favorable, the poor start to the growing season in June may prevent yields from reaching USDA’s June trend projection of 181.5 bushels per harvested acre.

A two million plus 2023/2024 US corn carryout projection could result in sub-$4.00 cash corn, based in central Illinois, during harvest. In addition to adverse weather, large Chinese corn purchases, like those of the 2020/2021 and 2021/2022 crop years, could shift corn prices into a summer rally.