1. Still thinking about the 255 million bushel corn stock surprise this morning. While we will never know for sure, I find it believable that the 2019 corn crop was over-estimated by that much. Some ways of thinking about it.
2. Let's start by assuming that the true size of 2019 corn crop was 13,360 mil bu, instead of the 13,620 revised number USDA released this morning. What combination of harvested acreage and yield gets us to 13,360 and does this seem sensible?
3. If we put all the adjustment down to 13,360 on harvested acreage at a yield of 167.4, then the true harvested acreage in 2019 was 79.8 mil acres not 81.3 million acres. That would be a drop of 1.5 million acres from official number.
4. I can believe that USDA was too high on 2019 corn harvested acreage by 1.5 million acres given everything that happened: difficulty accounting for first time for that much PP, farmer confusion on reporting PP, lost snow acres in ND, ..... A long list
5. The alternative is to put all the adjustment down to 13,360 on yield, This would drop the US average yield for 2019 back to 164.3 bpa, or a decline of 3.1 bpa from the official estimate of 167.4 bpa. Believable to me under the harsh growing conditions in many areas.
6. In sum, I think you can build a reasonable case that the 2019 corn crop was over-estimated by around 250 mil bu due to some combination of over-estimating harvested acreage and yield.
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