WASHINGTON (Reuters) — The Department of Agriculture on Thursday said U.S. farmers were likely to plant less corn in the upcoming season, switching land to soybeans and wheat instead, but that normal weather would still result in bumper crops all around.
USDA’s Office of the Chief Economist delivered an outlook for much lower corn, wheat and soybean prices for the 2014-15 marketing year.
The average farm price of corn for 2014-15 was estimated at $3.65 per bushel, against $4.50 in 2013-14. Soybean farm prices were estimated at $9.75 per bushel, against USDA’s current forecast of $12.70.
The 10-year forecasts are published each year in February and are developed by interagency committees within USDA, with the Economic Research Service taking the lead role.
As spring approaches, USDA estimated U.S. corn plantings for 2014-15 at 93.5 million acres, down from its most recent official figure for 2013-14 of 95.4 million but still very high by historic standards.
“I do think the corn number is a bit shocking to the market. In general, the plantings above 92 (million acres), and the type of stocks you might have, gives a reality check to a market that is 40 cents (per bushel) off its lows,” said Gordy Linn of the Chicago brokerage The Linn Group.
Ending stocks for U.S. corn in 2014-15 were forecast at a massive 2.607 billion bushels. But the starting point used by USDA, 2013-14 carryout of 1.887 billion bushels, was well above its most recent official forecast of 1.481 billion bushels, released on Monday.
Soybean plantings were estimated at 78 million acres, up from 76.5 million, setting the stage for a record large crop of 3.48 billion bushels in 2014-15, USDA said.
Wheat plantings were forecast at 57 million acres, up from 56.2 million in 2013/14, and given normal yields would produce a crop of 2.220 billion bushels, USDA said.