Released: January 12, 1999
Volume 99, No. 1

SORGHUM: Production of sorghum for grain in Kansas totaled 264.0 million bushels in 1998, according to Kansas Agricultural Statistics (see Table 1) . Kansas still ranks first in the nation in sorghum grain production. Production is up 9.90 million bushels from the November forecast but down 1.20 million bushels from last year. The yield, at 80 bushels per acre, was up 2 bushels from a year earlier and 3 bushels from the November forecast. Kansas farmers planted 3.50 million acres, 150,000 acres less than last year. Harvested area was 3.30 million acres, down 3 percent from 1997. Sorghum silage production, at 1,200,000 tons, was sharply lower than the 1997 production.

CORN: Corn production for grain totaled a record 419.0 million bushels, up 8.6 million from the November forecast, and 13 percent above last year's record high production of 371.8 million bushels. The yield averaged 147 bushels per acre, 3 bushels above the November forecast, and 4 bushels above the 1997 yield. Planted area was 3.00 million acres, 250,000 acres more than the previous year. Acreage harvested for grain, at 2.85 million acres, was up 10 percent from the area harvested in 1997. Corn silage production, at 2.28 million tons, was 1 percent above production in 1997.

SOYBEANS: Production of soybeans totaled 75.0 million bushels, down 2.5 million bushels from the November forecast, and 11.95 million bushels below last year's record production. Yield per acre is 30.0 bushels, down 1 bushel from November and 7 bushels from 1997. Harvested acreage was 2.50 million, up 6 percent from 1997.

HAY: Production of all types of hay was 8.02 million tons, up 610,000 tons from the previous forecast, and 1.18 million tons from the previous year. Alfalfa production was up 28 percent from 1997, and other hay production was up 6 percent from 1997. Alfalfa acreage harvested was up 100,000 from 1997. Other hay harvested increased by the same number of acres.

SMALL GRAINS: Wheat production was 494.9 million bushels, down 1 percent from the 1997 record crop of 501.4 million bushels. Acres planted totaled 10.7 million, down 6 percent from 1997. Acreage harvested, at 10.1 million acres, was down 7 percent but yield was up 3 bushels from 1997. Oat production of 2.70 million bushels was down 43 percent from the previous year. Barley production, at 280,000 bushels, was down 17 percent from 1997.

OTHER CROPS: Dry bean production, at 380,000 cwt., was unchanged from 1997. Sunflower production was 267.4 million pounds, compared to 223.2 million pounds in 1997. Cotton production, at 13,400 bales, compares to 8,700 bales in 1997. Harvest was 16,000 acres, compared with 10,000 acres harvested in 1997.

Table 1-- 1998 CROP SUMMARY, KANSAS
Crop & Unit	Planted Acreage	Harvested Acreage		Yield per Acre		Production
	1998	1997	1998	1997	1998	1997	1998
		1,000		Per Unit		1,000
Wheat, bu.	10,700	10,900	10,100	46	49	501,400	494,900
Oats, bu.	110	80	60	59	45	4,720	2,700
Barley, bu.	8	8	8	42	35	336	280
Rye, bu.	80	10	15	30	25	300	375
All Corn	3,000	2,725	2,970	-	-	-	-
Corn Grain, bu.	-	2,600	2,850	143	147	371,800	418,950
Corn Silage, tons	-	125	120	18 .0	19 .0	2,250	2,280
All Sorghum	3,500	3,530	3,380	-	-	-	-
Sorghum Grain, bu.	-	3,400	3,300	78	80	265,200	264,000
Sorghum Silage, tons	-	130	80	15 .0	15 .0	1,950	1,200
Soybeans, bu.	2,550	2,350	2,500	37	30	86,950	75,000
Sunflowers, lbs.	180	193	175	1,156	1,528	223,200	267,350
Dry Beans, cwt. 1/	20	20	19	1,900	2,000	380	380
Cotton, bales 1/	17 .0	10 .0	16 .0	418	402	8 .7	13 .4
All Hay, tons	-	2,700	2,900	2 .53	2 .77	6,840	8,020
Alfalfa Hay, tons	-	900	1,000	4 .00	4 .60	3,600	4,600
Other Hay, tons	-	1,800	1,900	1 .80	1 .80	3,240	3,420

1/ Yield in pounds.

CORN: The 1998 corn for grain production was estimated at 9.76 billion bushels, up 6 percent from the 1997 crop but down 1 percent from the November 1 forecast (see Table 2). The 1998 production level ranks second behind the 10.1 billion bushels produced in 1994. The U.S. yield of 134.4 bushels per acre was up 7.7 bushels from a year earlier. Planted area totaled 80.2 million acres, 1 percent more than 1997 and the largest planted acreage since 1985. An estimated 72.6 million acres were harvested for grain, unchanged from last year.

SORGHUM: Production of grain sorghum in 1998 was estimated at 520 million bushels, down 18 percent from 1997. Grain yields, at 67.3 bushels per acre, was 1.9 bushels below the 1997 average yield. The final estimate of all sorghum planted was 9.6 million acres, down 4 percent from a year earlier. Area harvested for grain was estimated at 7.7 million acres, down 16 percent from 1997.

SOYBEANS: Production of soybeans totaled 2.76 billion bushels in 1998, down slightly from the November 1 forecast but up 3 percent from 1997. The 1998 production is the highest on record, followed by the 1997 crop of 2.69 billion bushels. The average yield per acre in 1998 is estimated at 38.9 bushels, 0.3 bushel above the November 1 forecast. This is equal to the 1997 yield, which is the second highest yield on record behind the 1994 yield of 41.4 bushels. Planted area for the U.S., at 72.4 million acres, was up 3 percent from 1997. Harvested area totaled 70.8 million acres, an increase of 2 percent from 1997.

ALL WHEAT: The final 1998 wheat production totaled 2.55 billion bushels. This is changed from the estimate published in the "Small Grains Summary" 2.56 billion bushels, and 3 percent more than in 1997.

Table 2-- 1998 CROP SUMMARY, UNITED STATES
Crop & Unit	Planted Acreage	Harvested Acreage		Yield per Acre		Production
	1998	1997	1998	1997	1998	1997	1998
		1,000		Per Unit		1,000
Wheat, bu.	65,871	62,840	59,002	39 .5	43 .2	2,481,466	2,550,383
Oats, bu.	4,902	2,813	2,765	59 .5	60 .4	167,246	167,122
Barley, bu.	6,340	6,198	5,867	58 .1	60 .1	359,878	352,445
Rye, bu.	1,571	316	418	25 .7	28 .2	8,132	11,795
All Corn	80,187	78,725	78,523	-	-	-	-
Corn Grain, bu.	-	72,671	72,604	126 .7	134 .4	9,206,832	9,761,085
Corn Silage, tons	-	6,054	5,919	16 .1	16 .0	97,192	94,525
All Sorghum	9,626	9,570	8,028	-	-	-
Sorghum Grain, bu.	-	9,158	7,723	69 .2	67 .3	633,545	519,933
Sorghum Silage, tons	-	412	305	13 .1	11 .4	5,385	3,487
Soybeans, bu.	72,375	69,110	70,811	38 .9	38 .9	2,688,750	2,756,794
Sunflowers, lbs.	3,553	2,792	3,476	1,317	1,509	3,676,952	5,246,701
Dry Beans, cwt. 1/	2,010 .1	1,758 .8	1,913 .9	1,670	1,611	29,370	30,828
Cotton, bales 1/	13,417 .9	13,406 .0	10,722 .5	673	618	18,793 .0	13,796 .2
All Hay, tons	-	61,084	60,016	2 .50	2 .52	152,536	151,338
Alfalfa Hay, tons	-	23,551	23,642	3 .33	3 .47	78,535	82,010
Other Hay, tons	-	37,533	36,374	1 .97	1 .91	74,001	69,328

1/ Yield in pounds.

Wheat seeded in Kansas in the fall of 1998 for harvest in 1999 totaled 10.0 million acres, down 7 percent from the previous year. See table 3 for recent Kansas wheat estimates by district. Rye acreage planted, at 100,000, is up from 80,000 acres planted last year. Seeding of the 1999 wheat crop began in early September. By the end of September, seeding had reached 21 percent complete, behind both the previous year and average of 31 percent. Seeding progressed slowly due to the lack of moisture as many producers were waiting for rain. The rains finally came the first of October and planting progressed rapidly during the next 3 weeks. By October 26, 94 percent of the crop was seeded, on par with both previous year and average. Nearly 80 percent of the crop had emerged and condition was rated 70 percent good to excellent. Heavy rains were received over much of the State in early November. Weather continued mild throughout most of the remainder of the year, allowing the crop to develop good growth.

Winter wheat seeded in the United States for harvest in 1999 is estimated at 43.4 million acres, down 7 percent from 1998. This will be the lowest planted acreage since 1972. Class breakdowns are: hard red winter, 30.9 million acres; soft red winter, 9.0 million; and white winter, 3.5 million. Rye seeded in the United States for 1999 totaled 1.59 million acres, up 1 percent from 1998.

Table 3-- KANSAS WHEAT ACREAGE PLANTED FALL OF 1998 WITH COMPARISONS
Year	District Totals
	NW	WC	SW	NC	C	SC	NE	EC	SE	STATE
	1,000 Acres
1992	1,350	1,450	2,050	1,475	1,750	2,700	300	325	700	12,100
1993	1,300	1,400	1,975	1,500	1,750	2,600	325	325	725	11,900
1994	1,250	1,375	1,900	1,525	1,750	2,600	360	350	590	11,700
1995	1,210	1,405	1,919	1,443	1,781	2,675	325	352	690	11,800
1996	1,218	1,310	1,930	1,455	1,705	2,585	290	300	607	11,400
1997	1,200	1,270	1,670	1,430	1,580	2,400	260	290	600	10,700
1998	1,140	1,230	1,590	1,360	1,490	2,280	200	230	480	10,000
1998 as % of 1997	95	97	95	95	94	95	77	79	80	93

Table 4-- STOCKS OF GRAIN - DECEMBER 1, 1998, WITH COMPARISONS
Grain	Position	Kansas			United States
		Dec. 1, 1997	Sept. 1, 1998	Dec. 1, 1998	Dec. 1, 1997	Sept. 1, 1998	Dec. 1, 1998
		1,000 Bushels
All Wheat	On Farms	36,000	60,000	31,000	604,000	885,720	680,200
	Off Farms 1/	208,197	319,253	240,381	1,015,242	1,499,770	1,211,746
	TOTAL	244,197	379,253	271,381	1,619,242	2,385,490	1,891,946
Sorghum Grain	On Farms	45,000	8,000	51,000	99,625	13,700	95,900
	Off Farms 1/	126,815	19,897	122,035	274,244	35,203	237,831
	TOTAL	171,815	27,897	173,035	373,869	48,903	333,731
Corn	On Farms	83,000	9,500	105,000	4,822,000	640,000	5,320,000
	Off Farms 1/	147,598	35,877	149,283	2,424,756	667,803	2,730,220
	TOTAL	230,598	45,377	254,283	7,246,756	1,307,803	8,050,220
Oats	On Farms	1,500	*	*	83,200	110,300	81,500
	Off Farms 1/	1,953	1,056	710	61,051	51,515	61,841
	TOTAL	3,453	*	*	144,251	161,815	143,341
Barley	On Farms	*	*	*	134,500	193,500	140,900
	Off Farms 1/	35	49	36	109,561	132,652	121,523
	TOTAL	*	*	*	244,061	326,152	262,423
Soybeans	On Farms	21,500	2,500	23,000	1,048,000	84,300	1,187,000
	Off Farms 1/	46,517	7,045	38,868	951,417	115,499	999,756
	TOTAL	68,017	9,545	61,868	1,999,417	199,799	2,186,756
Hay	On Farms 2/	5,609	_	6,500	103,044	_	111,839
1/ Includes stocks at mills, elevators, warehouses, terminals, & processors. 2/ 1,000 tons. * Not pub- lished to avoid disclosure.

While corn and soybean stocks are up sharply from last year's levels, the situation looks somewhat different when stocks are measured as a percent of usage. For example, although soybean stocks are at their largest ever, December stocks, as-a-percent of usage during the September-November period, are only 282%. That's considerable less than the 23 year average which is 330%. In fact, there have been only five other years that the December stocks/usage ratio has been lower than this year's. First quarter usage of soybeans was the second highest ever at 776 million bushels, just 50 million bushels less than last year's record disappearance.

Similarly, the Dec. corn stocks/Sep.-Nov. use ratio is only 266%, much less than the 23 year average of 338%. As with the case in soybeans, there have been only five other years when the December stocks/usage ratio was lower than this year's. Corn use in the first quarter was a record 3,029 million bushels, 6% larger than last year and 5% larger than the previous record usage (set in 1994).

Despite the record (or near record) pace of soybean and corn usage, the USDA's World Board lowered their estimate of annual corn usage by 160 million bushels and raised their estimate of ending stocks by 85 million bushels. Corn ending stocks are now expected to be up 500 million bushels from last year. The USDA also lowered their price projection for corn_the mid-point of the range of their price forecast stands at $1.95.

Decreases in projected soybean exports and crush more than offset the small decline in production so the USDA increased their estimate of soybean ending stocks by 15 million bushels. Soybean ending stocks are now expected to be up 190 million bushels from last year. Because the stocks projection was increased, the USDA choose to cut the mid-point of the range of their price forecasts by $.10/bu. to $7.35. Wheat ending stocks were increased 73 million bushels but the mid-point of the price forecast was left unchanged at $2.70.

Given the record (or near-record) rate of use for soybeans and feed grains and the uncertainty about 1999 wheat production, it seems likely that crop prices could stabilize soon. Producers, who previously sold their 1998 row crop production, may want to consider a re-ownership strategy by purchasing in-or-at-the-money call options on July corn or soybean futures. Producers, looking for an opportunity to price a portion of their 1999 crops, may want to purchase way-out-of-the-money call options (4-7 strike price out-of-the-money) on KCBOT July wheat, December corn futures and November soybean futures. Considering the extremely low level crop prices are at currently, it seems unlikely that the markets will trade substantially lower until 1999 row crop plantings are complete and crop conditions are known with relative certainty. Given all the things that can happen between now and next year's harvest, it seems likely that there could be at least one or two rallies that should give producers a better pricing opportunity. Purchasing out-of-the- money call options now, "prepares the way" for pricing, if and when those rallies occur.

Table 5-- GRAIN STORAGE CAPACITY DECEMBER 1, 1997-98
Position	Kansas		United States
	1997	1998	1997	1998
	1,000 Bushels
On Farm	400,000	400,000	10,950,000	11,125,000
Off Farm	742,220	783,650	7,961,340	8,005,580
Total	1,142,220	1,183,650	18,911,340	19,130,580

Ron Sitzman & Deonne McCray, Agricultural Statisticians
Eldon J. Thiessen, State Statistician
Eddie Wells, Deputy State Statistician

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