The last week in February is always an important time with respect to the initial outlook for the coming crop year. USDA releases its first stab at crop acreage at its Outlook Forum held annually at the end of the month. That initial forecast is always highly anticipated by the trade.
This year’s numbers didn’t bring much of a surprise. That is, corn acreage was estimated at 90 million acres while soybeans were pegged to garner 88 million acres in 2017. Meanwhile, wheat acreage is predicted at 46 million acres this year. The three crops combine for a total of 224 million acres.
However, several trends are important. First, if farmers follow through as outlined above, corn and soybean acreage establish a new record of 178 million acres, combined. And second, wheat acreage continues its decline, down 31 million acres since 1990, in deference to other crops – and that trend likely won’t reverse until there’s some indication of sustainably better prices.
In the meantime, though, the market will be watching the acreage trends between corn and soybeans closely. While the initial indication is for soybeans to capture more acres in 2017 versus 2016, that collective decision could change quickly. That’s especially true considering the widespread outlook for warmer weather – it’s difficult to be patient when planting conditions turn favorable. If that occurs, we could see a decisive shift back toward more corn acres.
How do you see this year’s acreage battle settling out? Do you think these numbers will hold? Or do you envision that we’ll see plantings that are closer to last year’s numbers—94 and 83 million acres for corn and soybeans, respectively? Leave your thoughts in the comments section below.
Nevil Speer is based in Bowling Green, Ky., and serves as vice president of U.S. operations for AgriClear, Inc. – a wholly-owned subsidiary of TMX Group Limited. The views and opinions of the author expressed herein do not necessarily state or reflect those of the TMX Group Limited and Natural Gas Exchange Inc.