Farmers intend to plant more acres to corn and fewer to soybeans than analysts expected ahead of USDA’s Prospective Plantings report issued Tuesday.
Corn is estimated at 89.2 million acres, 2% less than last year. If realized, USDA analysts say it would be the third consecutive year of declining corn acreage and would be the fewest acres planted to corn since 2010. Ahead of the report, the average estimate by analysts surveyed by Bloomberg was for 88.8 million acres.
“The increase in corn was a bit of a surprise, and the market has not responded favorably,” says John Anderson, American Farm Bureau (AFB) deputy chief economist. He notes that corn futures sank 15¢ per bushel on the news. Futures bounced back to close an average of 4¢ lower through the front six contracts, week-to-week.
Although the USDA report estimated soybean acres at a record-high 84.6 million acres, it’s significantly less than the average analyst estimate for soybeans of 85.95 million acres.
Rather than the straight swap of soybeans for corn as many envisioned, the USDA report suggests farmers are looking for alternatives.
Other feed grains (grain sorghum, barley and oats) are all projected to be up from last year. The combined increase for these three crops is almost 1.3 million acres. According to AFB, that almost completely offsets the projected year-over-year decline in corn acreage.
The all-wheat planted area is estimated to be 55.4 million acres, 3% less than last year. Estimates by analysts heading into the report were for 55.67 million acres.
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