When the USDA finally released its final crop estimates for the 2010 crop season earlier this month, it was no longer just conjecture that early USDA estimates were wrong, and by big margins. In fact, the national drop from August to January final yield in the corn crop of 12 bushels per acre either ties or pushes the record hard for the biggest error ever in USDA estimates.
Nationally, USDA was looking at 165 bushels per acre in August. Of course, that estimate is based largely upon plant counts in the field and overall condition of the crop. It was made before stifling heat set in across much of the Corn Belt. The final number wound up at 153 bushels per acre.
In Indiana, the difference was even more dramatic. USDA projected an average yield of 176 bushels per acre for Indiana in August, which would have produced Indiana's first billion bushel corn crop. But it was not to be. The number dropped 19 bushels per acre, all the way to 157 bushels per acre in the final estimate. Still, it was above the national average.
And it wasn't the biggest mistake USDA made. In Illinois, the difference between the early estimate released in the August crop report and the final released in mid-January was 23 bushels per acre. That's quite a gap!
Wisconsin actually gained 3 bushels form August, and Minnesota only lost one bushel form August to final report. But Arlan Suderman, Farm Futures market analyst, says every other major corn growing state posted major drops from August through the final report. Iowa, while less than Indiana and Illinois, lost 14 bushels per acre in their report.
Suderman speculated early on that it was the high night temperatures that caused a lot of the miscalculation. USDA estimates assume normal weather conditions from the point when the estimate is made. August across most of the Midwest was anything but normal, featuring hot, dry weather and high temperatures at night. When it's hot at night, it causes the plant to use sugars that would otherwise contribute to yield just to maintain plant processes.
The only other year when the national yield dropped this much, as far as Suderman knows, was a year with a similar weather pattern, including warm nights.
However, he's encountered people who still believe the difference was more related to too much or too little rain, depending upon where in the Corn Belt you grew corn. Suderman notes that the trend of decreases from August to final yield tended to cut across all precipitation trends.
No word yet on whether USDA intends to adjust its estimation procedure, or stay with its current methods for the coming year