As for the U.S. crop this year, there’s uncertainty over exactly how large it will be, says Williams.

“We had an unusually cool, wet spring, and a lot of producers weren’t able to get all of their crop in, at least on time, and some of them didn’t get it in at all. There’s a potential for our acres to be quite a bit lower than what some reports are indicating,” he says.

Drier weather which moved into the Corn Belt in late summer and early fall could have an impact on soybean totals, says Williams.

 

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“At this point of the year, much of the crop is already finished, so if it is dry, then it’ll make harvest easier and quicker. But with the late planting this year, it’s of a little bit more concern because some of that crop hasn’t been fully developed yet.

“So the question is whether or not these late-season dry conditions will have an effect on this year’s soybean yields. We were also seeing some drought creep into parts of Louisiana, Arkansas and Mississippi, but that was helped by timely rainfall.”

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The U.S. seasonal outlook for soybeans is improved this year over last year, says Williams. “Things look much better this year than last year, and hopefully that’ll be reflected in our soybean yields. The 2012 crop was not a good one in terms of yield, but the vast majority of the Corn Belt is looking as if their yields will be better than last year.

“Even the low 40s is not bad in terms of soybean yields, especially considering what they could be, and if you look at some of our yields in the Southeast.

“Iowa actually has a lower projected yield this year than last year, and they’re expected to be the No. 2 soybean-producing state this year. If the second-largest producing state is estimated to have lower yields than last year, that’s a little concerning.”

In the Southeast, only two states — Kentucky and Tennessee — are expected to have better yields this year than last.

“But those two states also were hit harder by the drought than other Southeastern states in 2012. Even though we don’t have higher projected yields overall this year, we set the bar high last year. A lot of states, including Mississippi, had record-high soybean yields last year.

If we look at acres and yields, that translates into production. We’re expecting higher production this year than last year because of low overall yields last year and an improvement in yields this year.”

The WASDE September harvested acres report estimated a crop of a little more than 76 million acres while FSA pegged it at 74.5 million.

“That’s a big difference. When you extrapolate that out, it’s a 73-million bushel difference in production. The FSA reported about 1.7 million prevented acres. Something has to give. Either the FSA is wrong or WASDE is wrong. This difference shows the potential for a shakeup in the markets.”