The U.S. corn production forecast was increased to 14.6 billion bushels, up almost 300 million bushels over the October forecast.
A price rally for corn in the short run may come from the supply side.
Rather than project the planted acreage of soybeans, it could be informative to think about the number of soybean acres necessary in 2018.
The release of USDA's October reports created a rally in soybean prices that pushed November soybean futures prices to levels not seen since the end of July.
A weather outlook for Brazil indicates continued dryness, which may delay planting even longer and have implications for second-crop corn planting in the region.
Despite large production, U.S. soybean prices may have long-term support due to increasing demand and usage.
The August Crop Production report surprised many market observers by forecasting 2017 corn production at 14.153 billion bushels.
The larger-than-expected production levels for both crops sent harvest futures prices to lows not seen since late in June.
While market observers focus on the changing outlook for corn and soybean yields, export markets continue to reveal consumption information relevant to price formation.
The volatility in price movements associated with weather will continue for the next six to eight weeks.