Iowa, U.S. farmers crush soybean production records

     Soybean production soared to new heights in 2015. This year, it hit the stratosphere.

     U.S. Department of Agriculture (USDA) reports, released Jan. 12, confirmed Iowa and U.S. soybean farmers didn’t just break production records, they shattered them. But they still have an opportunity to turn a profit, Iowa Soybean Association (ISA) leaders and marketing experts say.

     Iowa farmers harvested a record 571.7 million bushels of soybeans last year, according to the annual USDA Crop Production Summary Report. The previous record was 554 million bushels. 2016 Iowa soybean yields averaged a nation’s best 60.5 bushels per acre, 4 bushels better than last year’s all-time high, the report said.

     “Iowa’s best-ever harvest is a testament to our soybean farmers, the technologies we have and the work that ISA is doing to make farmers more competitive,” said Rolland Schnell, ISA president from Newton.

     Final U.S. soybean production is pegged at a record 4.3 billion bushels, according to the report. That’s 10 percent more than the previous high. The average yield nationwide was 52.1 bushels per acre, 4 better than the previous top, statistics show.

     Demand remains strong to move the bin-buster crop, according to today’s USDA World Agricultural Supply and Demand Estimates (WASDE) Report.

     U.S. soybean exports and crush remained unchanged from the last report at 2.05 billion bushels and 1.93 billion bushels, respectively. Both USDA reports are positive, according to ISA leaders and market analysts.

     The government reduced U.S. soybean production and yield by 54 million bushels and .4 bushels per acre from last month. Soybean supplies are down 60 million bushels on lower production and imports. And ending stocks are projected at 420 million bushels, down 60 million from last month.

     “Short term this is friendly. I’m delighted to see it,” said Al Kluis, owner of Kluis Commodities of Wayzata, Minn. “We have this big crop, but we’re starting to chew threw it, which is encouraging.”

     The commodity analyst and trader said the excellent quality of last year’s beans is attracting buyers worldwide. That could drive sales to the U.S. later in the marketing year when South American soybeans typically dominate the market.

     “Exports may hang in there better than expected,” Kluis said during a webinar with farmers and industry stakeholders.

     Schnell added, “This is going to offer opportunities to market soybeans at a good price, which reinforces the fact they are an important part of the rotation mix in Iowa.”

     The 2016 -17 U.S. season-average soybean price is forecast at $9 to $10 per bushel, according to the WASDE report. March soybeans on the Chicago Board of Trade closed today at $10.40, up nearly 29 cents from the opening bell.

     “For Iowa producers, prices are profitable. Make sure you don’t let that slip by,” said Don Roose, president of U.S. Commodities, Inc. based in West Des Moines.

     Prices above the USDA high range may not last long, he said. A big South American soybean crop is forecast and an additional 4 million soybean acres are likely to be planted in the U.S., Roose said.

     “Farmers may want to sell cash and re-own some bushels later with call or window options,” he said.

     ISA market development director Grant Kimberley said demand is strong and doesn’t show any signs of slowing down.

     “It could increase more if there’s even a minor hiccup in production in South America,” Kimberley said.



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