USDA says corn acres to decline, yields increase in decade ahead

By Susanne Retka Schill | December 22, 2014

USDA long-term projections call for slightly lower corn acres to be planted over the next decade while corn yields steadily climb. The USDA will release the complete long-term supply, use and prices projections to 2024 for major crops and livestock products on Feb. 11, but recently made the tables available to the public.

The projections indicate planted corn acres are expected to be 88 million acres in 2015/16 which compares to 90.9 million in the current marketing year. Then the agency expects planted corn acres to rebound to 90 million acres in 2016/17 and the following two years, dropping to 89.5 million acres in 2019 and 89 million acres by 2021.

While the USDA expects area planted to corn to decline slightly, it expects national average corn yields to climb steadily to 185.3 bushels by 2024. That compares to the estimated 2014, above-trendline yield of 173.4 bushels per acre and a 167.2 bushel-per-acre yield projected for 2015.

The projected acres and yields will bring result in steadily growing production figures, from 13.445 billion bushels forecast for 2015 to 15.085 billion bushels in 2024. Ending stocks are projected to decline slightly over the decade from the 2.008 billion bushels projected for the current marketing year to 1.733 billion bushels in 2015 and then slowly declining to 1.658 billion bushels by 2024. The stocks/use ratio, which was 9.1 in 2013 and is projected at 14.7 for 2014, is expected to drop to 12.6 for the 2015/16 marketing year and decline over the decade to 11.0 by 2024/25.

The USDA projections don’t call for farm-gate corn prices to top $4 for the next decade, projecting $3.40 farm prices in 2015 that climb a nickel each year to reach $3.75 in 2024.

Corn use for ethanol and coproducts is forecast at 5.2 billion bushels for 2015, declining to 5.075 billion bushels in 2018 through 2020 before climbing back to 5.2 billion bushels by the 2024/25 marketing year.

Planted acres for sorghum are expect to remain relatively stable at 7.5 million acres in 2015, declining slightly each year to 7.0 million acres by 2024. That compares with 7.2 million acres estimated for the 2014/15 marketing year and 8.1 million acres in 2013/14. Average national yields are expected to remain stable at 65 bushels per acre and farm-gate prices are projected to stay a dime lower than corn, at $3.30 per bushel for the 2015/16 crop and $3.65 per bushel by 2024.

In the statement announcing the early release of the tables, USDA explained its long-term agricultural projections “are a departmental consensus on a long-term representative scenario for the agricultural sector for the next decade. The projections are based on specific assumptions about macroeconomic conditions, policy, weather, and international developments, with no domestic or external shocks to global agricultural markets. The Agricultural Act of 2014 is assumed to remain in effect through the projection period. The projections reflect a composite of model results and judgment-based analyses and were prepared during October through December 2014. The projections use as a starting point the short-term projections from the November 2014 World Agricultural Supply and Demand Estimates report.”