Market Commentary for 4/21/25

Jon Scheve with weekly market commentary made on April 18, 2025

National yields are always highly debated within the trade from when they are first published in the May USDA WASDE report until they are nearly finalized in the January report. It makes sense, because yields are the biggest driver of supply and the quickest way for prices to rally.

Each year, the USDA publishes a trend line yield that seems too high for some market participants. Often, it’s because the yield estimate requires a new record or a tying of a previous record yield. 

I expect the USDA will start the year in May with a national yield of 181 bushels per acre. For one, it would be near the 50-year straight-trendline yield. Two, it’s the estimate the USDA Economic forum showed in their February report, and the USDA has used the forum’s yield estimate as their starting point for the last few years.

How Often Do New Records Happen?

More often than one may think.

• Last 50 years – 20 times – or 40% of the time

• Last 40 years – 14 times – or 35% of the time

• Last 30 years – 9 times – or 30% of the time

• Last 20 years – 7 times – or 35% of the time

Basically, this suggests that in 1 out 3 years there will be a new record yield. The following chart illustrates this:

Almost every year there are people who say the national yield will fall substantially below trend for some reason, usually for a weather issue. However, the chart above shows that in the last 50 years the national yield only fell 4 bushels below the trendline 10 times, or 20% of the time. This suggests there is a better chance the national yield will hit a new record every year, instead of having a big loss.

And the most common outcome, 37 out of the last 50 years (or 74% of the time), the final yield was above or within only 2 bushels below the 50-year straight-trendline yield. That indicates there is a good chance the national yield will be over 179 this year.

But Is the Yield Trend Growth Slowing?

Many crop watchers’ debate this issue; however, based on the chart above yield trend growth doesn’t seem to be slowing. In 2020, after 5 of the previous 6 years had above trend yields, very few market participants would have thought this.

In the chart below, if we look at the straight-trendline yield of only the last 10 years, the yield was over trend line 6 times:

Only in 2019, when the crop was planted very late, did the yield fall more than 4 bushels below the 10-year straight-line average. This chart suggests there is a 90% chance the yield will be over 175, if the crop is planted on time, and there is a 60% chance the yield will be over 179.

Daily Average Temperature

My colleagues at CropProphet have analyzed the impact of the daily average temperature during pollination on final yields for many years. Their findings in the chart below indicate the weather during pollination over the last 10 years has actually been very stable compared to the previous 35 years.

This narrow range of average to cooler temperatures during pollination has likely helped keep yields relatively consistent. And cooler temperatures during pollination give crops a better chance at higher yields.

What Will the Final National Yield Be This Year?

Trendline yield data from the last 50 years says there is a nearly 75% chance of a 179 yield or higher. The odds may be even better if weather patterns from the last 10 years remain consistent. 

On the downside, and based solely on historical data, there is still a 20% chance the yield will fall below 177.

Bottomline:

While the weather is unpredictable, human nature is not. I expect a lot of fearmongering in the market this summer with plenty of negative weather headlines that will drive prices higher at some point. While a widespread national drought that leads to a price rally is always possible, the odds are lower than most people realize. Producers should look at any rally due to a weather scare as an opportunity to sell or at least protect their downside.

Jon Scheve

Superior Feed Ingredients, LLC

9358 Oak Ave

Waconia, MN 55387

jon@superiorfeed.com