The Agriculture Department estimated Wednesday that farmers will harvest a record corn crop this fall and produce the second largest volume of soybeans ever.

The forecast, which is based on the season's first survey of crops, was completed too early to account for damage in Iowa from this week's storms. USDA said the storms' effect would be factored into future reports. 

The government estimated that farmers will harvest 15.3 billion bushels of corn, a 12 percent increase from 2019, when spring flooding prevented many growers from planting. USDA estimated the average yield at 181.8 bushels per harvested acre, up 14.4 bushels from last year. 

The soybean harvest was forecast at 4.42 billion bushels, up 25 percent from 2019, with an average yield of 53.3 bushels per acre, an increase of 5.9 bushels from last year. 

USDA's monthly World Agricultural Supply and Demand Estimates report increased the department's forecast of ending stocks for corn, soybeans, and wheat, and lowered the estimated average price of this year's corn crop to $3.10 a bushel, down from the July estimate of $3.35. 

USDA is projecting that corn usage for ethanol will increase to 5.2 billion bushels for the 2020 crop, up from 4.85 billion bushels for the 2019 harvest. But Jim Mintert, agricultural economics professor at Purdue University, said he questioned whether the rebound would be that large. The lagging ethanol usage is the major factor pushing down the price of corn, he said.

Some 5.4 billion bushels of the 2018 crop were used for ethanol. 

Corn ending stocks increased by 108 million bushels to 2.75 billion, up from last month’s 2.6 billion bushels. Soybean ending stocks were increased from 425 million bushels to 610 million bushels. Ending stocks for wheat were reduced from 942 million bushels in July’s estimate to 925 million bushels in August.

Allendale Inc. President Steve Georgy said the big question moving forward is where all this grain is going to go.

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“In 2016 we had a big crop and we had prices – December futures prices work down to $3.14 and three-quarters cents, and we were only talking 2.5, 2.6 (billion) then this is even bigger than that,” Georgy told Agri-Pulse, referring to corn ending stocks.

However, he said larger ending stocks estimates provide a cushion for USDA as more corn and soybean purchases from China are probably going to happen, since the U.S. still offers the lowest prices. 

“If China does come in and fulfill any sorts of this 'phase one' deal, now (USDA) can make these adjustments and we’re not sitting with tight ending stocks,” he said.

As far as straight-line winds flattening Iowa’s crops Monday, Georgy said traders are not really factoring impacts in right now because it is tough to tell how bad yields were affected until combines get rolling this fall.