The impact of drought and fires in Russia was felt all the way back to U.S. dairy farms this week on news that Russia will ban all exports of wheat through the end of the year, sending grain prices higher.
Now that the “smoke has cleared,” sort of speak. Dairy Profit Weekly editor Dave Natzke reported Friday that the news sent wheat futures to spike earlier in the week and pulled other grain prices higher, creating fears of skyrocketing feed prices for U.S. dairy and livestock farmers. Thankfully, grain prices moderated somewhat later in the week, Natzke said.
Helping relieve some of the concern, USDA’s crop production report, released on Thursday, estimated both 2010 U.S. corn and soybean crops to be the largest on record. The corn crop is forecast at a record high 13.4 billion bushels, with yields expected to average a record high 165.0 bushels per acre, and soybean production was forecast at a record high 3.43 billion bushels, with yields expected to equal last year’s record of 44.0 bushels per acre.
With the record U.S. crops, USDA projects larger supplies of feed grains, Natzke reported, although strong export demand will eat up much of that supply.
Heavy global demand caused USDA to raise its season-average price forecasts slightly. Farm-level corn prices are now expected in a range of $3.50-$4.10 per bushel, up a nickel on each end; and soybean price projections were raised 40 cents on each end, to a range of $8.50-$10.00 per bushel.
USDA’s weekly crop/weather report says U.S. corn and soybean crops are advancing well ahead of schedule. And, despite widespread heavy rains, more than two-thirds of both corn and soybean crops are rated; good to excellent.
USDA adds that abundant moisture is helping produce record or near-record high yields of alfalfa and other hay, as well.
Corn and soy complex futures were higher after USDA’s Thursday reports, despite the higher-than-expected corn and soybean production estimates. Strong domestic and global use was cited, Natzke concluded