Unpriced Corn Inventories Higher Than Other Commodities After 2019 Harvest, Study Reveals

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The Coronavirus pandemic led to sharp declines in agricultural commodity prices, impacting U.S. farmers. In response, Congress created the Coronavirus Food Assistance Program (CFAP), providing direct payments to producers with unpriced inventories facing price declines. Researchers from the USDA's Economic Research Service analyzed producer responses from the 2019 Agricultural Resource Management Survey to understand the volume of unpriced inventories held during this period. The study found that median unpriced corn inventory exceeded that of other crops and increased with farm size, with very large farms holding the largest amounts.

Key Takeaways:

  • The median volume of unpriced corn inventory exceeded that of all other unpriced crops, highlighting its significance in the agricultural market.
  • The median quantity of unpriced soybeans held was, on average, 33.7 percent of the amount of corn held.
  • Very large farms held the largest median quantity of unpriced soybeans, at 32,000 bushels, and also had the largest amount of unpriced cotton inventory at 74,200 bushels.
  • Large farms held the largest amount of unpriced wheat inventory at 36,000 bushels, while very large farms held the largest amount of unpriced corn inventory, ranging from 5,700 bushels for small farms to 209,000 bushels for very large farms.
  • The report found that corn, soybeans, wheat, and cotton accounted for more than half of total crop cash receipts in 2020 and the vast majority of CFAP 1 payments.
  • The study did not examine the reasons for the differences in unpriced inventory levels for corn and soybeans, which may be due to differences in yields and prices.

Statistics:

  • Median unpriced corn inventory: no specific figure mentioned in the story
  • Median quantity of unpriced soybeans held: 33.7 percent of the amount of corn held
  • Largest median quantity of unpriced soybeans held: 32,000 bushels
  • Largest median quantity of unpriced cotton inventory: 74,200 bushels
  • Largest amount of unpriced wheat inventory: 36,000 bushels
  • Largest amount of unpriced corn inventory for small farms: 5,700 bushels
  • Largest amount of unpriced corn inventory for very large farms: 209,000 bushels

Sources:

  • U.S. Department of Agriculture's Economic Research Service, report by Noah Miller, Anil K. Giri and Dipak Subedi, December 11, 2023.