Although a very wet spring delayed planting of the 2013-14 U.S. soybean crop, ideal weather materialized after the crop made it into the ground, which – for a while anyway – seemed adequate to mitigate the potential problems associated with a shorter growing season. The July USDA crop report forecast a record 2013-14 U.S. soybean crop. Before the release of the August USDA crop report, both old- and new-crop soybean prices traded down to fresh season lows. Soybean and soy product prices looked much lower. For technical analysts, it was a make-or-break of the bull market that began in 2006 as prices came to challenge a long-term uptrend line.
Even before the release of the August crop report, hot and dry conditions emerged, and analysts began trimming their crop estimates. The July crop estimate was 3.42 billion bushels, based on record acreage of 77.7 million acres and a record yield of 44.5 bushels per acre (bpa). The average guesstimates for the August report called for a crop of 3.338 billion bushels and yields of 43.472 bpa. As it turns out, analysts underestimated the crop damage. The USDA slashed the acreage estimate by 500,000 acres and lowered the yield to 42.6 bpa, for a crop that would reach only 3.255 billion bushels.