How Big are Corn, Soybean Crops?
As prices move higher, it is useful to try to estimate the U.S. crop size that is reflected by current prices. Obviously, a precise estimate cannot be made because other factors are influencing price. In addition, the relationship between crop size, consumption, and price varies over time. Still, prospective crop size is a useful question to pursue. As a starting point, USDA’s current projection of the level of stocks at the beginning of the 2005-06 marketing year and the magnitude of consumption during the 2005-06 marketing year can be used. The current average farm price of corn and soybeans during the 2005-06 marketing as reflected by the futures market can be calculated based on a forecast of average basis and the monthly distribution of farmer marketings during the 2005-06 marketing year. Here, the three year average monthly basis and the five year average of monthly marketings (as a percentage of the total for the year) are used to make the calculation. Using that process, the fu
