Despite severe Midwest floods this June, U.S. crop producers are on pace to produce the second largest corn crop and fourth largest soybean crop in history, according to today's Crop Production report released by USDA's National Agricultural Statistics Service.

U.S. corn production is forecast at 12.3 billion bushels, down 6 percent from last year’s record, but up 17 percent from 2006. Based on conditions as of Aug. 1, corn yields are expected to average 155 bushels per acre, up 3.9 bushels from last year. If realized, this would be the second highest corn yield on record, behind 2004. Growers are expected to harvest 79.3 million acres of corn for grain, down 8 percent from 2007.

Soybean production is forecast at 2.97 billion bushels, up 15 percent from last year but down 7 percent from the 2006 record. Yields are expected to average 40.5 bushels per acre, down 0.7 bushels from 2007, while harvested acres are expected to be 17 percent higher than in 2007.

Average corn prices this year are expected to drop to $4.90 to $5.90 per bushel, down 60 cents from last month's forecast of $5.50 to $6.50. Corn prices soared to record levels near $8 after the floods, the worst to hit the Midwest in 15 years. 

Soybean prices also are expected to fall to $11.50 to $13 per bushel, down 50 cents from $12 to $13.50 last month, according to USDA.

The August Crop Production report contains NASS’s first estimates of yield and production for corn, soybeans and other spring-planted row crops. To help ensure that these estimates were based on the best information available, NASS supplemented its standard data collection activities in order to account for the impact of June's Midwest flooding. NASS personnel re-interviewed approximately 9,000 farmers in flood-affected areas who had previously reported their planted acreage to the agency in early June. Additionally, NASS increased the number of corn and soybean fields selected for objective field measurements in the flood-affected areas and increased the sample size for the Agricultural Yield Survey, through which farmers report expected crop yields.

USDA increased its estimate of corn that will be used for ethanol production to 4.1 billion bushels, up from last month's estimate of 3.95 billion.

The department also raised its wheat production forecast by 2 million bushels, to 2.462 billion, and projected that wheat prices will average $6.50 to $8, down 25 cents from last month.

The Crop Production report is published monthly.

Source: USDA