click image to zoom Table 2 presents the calculated unconditional U.S. trend yield for corn and soybeans in 1988 and 2012, the actual U.S. average yield in 1988, the forecast average yields for 2012 (from USDA's September Crop Production report), and the difference between trend and actual (or forecast) yields. The unconditional trend yield for 1988 is calculated from the linear trend of actual yields (not adjusted for varying weather conditions) from 1960 through 1987. Similarly, the unconditional trend yield for 2012 is calculated from the linear trend of actual yields from 1960 through 2011.
For corn, the difference between actual (or forecast) yields is 32.8 bushels for 1988 and 35.6 bushels for 2012. The difference in the magnitudes of the yield shortfalls is consistent with the observed weather patterns in those two years. Most analysts, including the authors, however, calculate the trend yield for 2012 to be above the unconditional linear trend of 158.4 (see this earlier post). Based on a 2012 trend yield of 161 bushels, the forecast yield is 38.2 bushels below trend, 5.4 bushels larger than in 1988, a difference even more consistent with the differences in weather patterns.
For soybeans, the difference between actual (or forecast) yields is 5.2 bushels for 1988 and 7.7 bushels for 2012. The difference in the magnitudes of the yield shortfalls is not consistent with the observed weather patterns in those two years. Additionally, most analysts, including the authors, calculate the trend yield for 2012 to be slightly above the unconditional linear trend of 43 bushels. Based on a 2012 trend yield of 43.5 bushels, the forecast yield is 8.2 bushels below trend, 3 bushels larger than in 1988. Again the larger yield shortfall in 2012 appears to be inconsistent with weather patterns in the two years.
The simplified weather and yield analysis presented here suggests that the USDA's September corn yield forecast of 122.8 bushels may be near the actual yield estimate to be released in January. A slightly smaller estimate would not be a surprise based on the severity of summer weather. In contrast, the USDA's September soybean yield forecast of 35.3 bushels appears to be too low based on late season weather conditions. Updated yield forecasts will be released in the USDA's October 11 Crop Production report.