Market close: Corn tumbles 4 percent on USDA acreage forecast shock

CHICAGO, March 31 (Reuters) – U.S. corn futures plunged more than four percent on Thursday in the market’s steepest drop since mid-August after the U.S. Agriculture Department forecast 2016 planted acreage well above trade expectations.

Soybeans initially drifted lower on spillover pressure from corn, but they closed slightly higher, supported by the USDA’s lower-than-expected soybean acreage and quarterly stocks estimates.

Canola edged higher with may closing at $476.20, up $1.60 or 0.34 percent. Soy oil rose 1.27 percent and supported canola.

Wheat firmed on short covering, led by spring wheat futures which gained 2.8 percent after the government pegged planted acreage below trade expectations at the lowest since 1972.

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Corn fell to contract lows as the USDA report showed U.S. farmers are planning to boost their corn seedings by 6.4 percent this year to 93.601 million acres, which would be the third-highest level since 1944.

“That’s going to be the headline grabber: the big surge in corn acres,” said Arlan Suderman, chief commodities economist for INTL FCStone.

“Farmers prefer to plant corn. That’s their desired crop. They see the most opportunity there for being able to capture something down the road if we have a weather scare,” he said.

Soybean seedings were seen at 82.236 million acres, which would be the third-highest level ever but below the average trade forecast.

However, analysts said final acreage has would likely shift due to firmer soybean prices since the USDA’s survey was concluded earlier this month and as some farmers in flooded areas of the South may replant corn fields with soybeans.

“This survey was taken a little over four weeks ago, and a lot has happened during these last four weeks,” said Ted Seifried, vice president and chief market strategist for Zaner Ag Hedge.

The USDA also pegged March 1 corn stocks at 7.808 billion bushels, above the average analyst estimate of 7.801 billion and the largest for the quarter since 1987.

Soybean stocks rose to 1.531 billion bu., below trade expectations for 1.556 billion, while wheat stocks rose to 1.372 billion bu., but that total was below the forecasts for 1.356 billion.

U.S. seeding intentions

American farmers surprised the trade with a plan to increase corn acres by six percent. They also told the U.S. Department of Agriculture they would seed fewer soybean and spring wheat acres than expected. They plan big increases in pulse acreage.

U.S. seeding intentions

Seeded area (million acres):

Acreage            2015            2016            trade*

Corn               88.00           93.60            89.97

Soybeans           82.65           82.24            83.06

All Wheat          54.64           49.56            51.70

   Spring Wheat    13.25           11.34            12.84

   Durum            1.94           2.00             1.86

Barley              3.56            3.14             3.57

Oats                3.09            2.75             3.04

Canola              1.77            1.75             --

Dry Peas            1.14            1.42             --

Flax                0.46            0.39             --

Lentils             0.49            0.85             --

Chickpeas           0.21            0.25             --

*Average of traders’ estimates

Source: USDA | WP GRAPHIC

Light crude oil nearby futures in New York were up two cents to US$38.34 per barrel.

The Canadian dollar at noon was US77.10 cents, down from 77.15 cents the previous trading day. The U.S. dollar at noon was C$1.2971.

Winnipeg ICE Futures Canada dollars per tonne

Canola May 2016 476.20 +1.60 +0.34%

Canola Jul 2016 481.90 +2.20 +0.46%

Canola Nov 2016 480.10 +2.90 +0.61%

Canola Jan 2017 483.20 +2.90 +0.60%

Canola Mar 2017 484.60 +2.70 +0.56%

Milling Wheat May 2016 240.00 +2.00 +0.84%

Milling Wheat Jul 2016 240.00 +2.00 +0.84%

Milling Wheat Oct 2016 237.00 +2.00 +0.85%

Durum Wheat May 2016 295.00 -2.00 -0.67%

Durum Wheat Jul 2016 286.00 -2.00 -0.69%

Durum Wheat Oct 2016 280.00 -2.00 -0.71%

Barley May 2016 176.00 unch 0.00%

Barley Jul 2016 178.00 unch 0.00%

Barley Oct 2016 178.00 unch 0.00%

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound

Chicago

Soybeans May 2016 910.75 +1.75 +0.19%

Soybeans Jul 2016 917.75 +1.5 +0.16%

Soybeans Aug 2016 920.5 +2 +0.22%

Soybeans Sep 2016 920.75 +1.75 +0.19%

Soybeans Nov 2016 924.75 +1.75 +0.19%

Soybeans Jan 2017 928.5 +2 +0.22%

Soybean Meal May 2016 270.3 -1.6 -0.59%

Soybean Meal Jul 2016 273.1 -1.5 -0.55%

Soybean Meal Aug 2016 274.4 -1.5 -0.54%

Soybean Oil May 2016 34.22 +0.43 +1.27%

Soybean Oil Jul 2016 34.44 +0.43 +1.26%

Soybean Oil Aug 2016 34.53 +0.43 +1.26%

Corn May 2016 351.5 -15.5 -4.22%

Corn Jul 2016 355.75 -15.75 -4.24%

Corn Sep 2016 360.5 -15.5 -4.12%

Corn Dec 2016 368.75 -15.25 -3.97%

Corn Mar 2017 378.25 -14.5 -3.69%

Oats May 2016 185.5 +0.25 +0.13%

Oats Jul 2016 196.25 unch 0.00%

Oats Sep 2016 205.25 unch 0.00%

Oats Dec 2016 214.5 -0.75 -0.35%

Oats Mar 2017 219.25 -0.5 -0.23%

Wheat May 2016 473.5 +9.5 +2.05%

Wheat Jul 2016 480.75 +9.25 +1.96%

Wheat Sep 2016 490.25 +8.75 +1.82%

Wheat Dec 2016 504 +8 +1.61%

Wheat Mar 2017 517.25 +7.5 +1.47%

Minneapolis

Spring Wheat May 2016 529.5 +14.25 +2.77%

Spring Wheat Jul 2016 537.75 +14.5 +2.77%

Spring Wheat Sep 2016 547 +14 +2.63%

Spring Wheat Dec 2016 559.5 +12.75 +2.33%

Spring Wheat Mar 2017 571.75 +11.25 +2.01%

Kansas City

Hard Red Wheat May 2016 476.25 +10.5 +2.25%

Hard Red Wheat Jul 2016 487 +10 +2.10%

Hard Red Wheat Sep 2016 501 +9.75 +1.98%

Hard Red Wheat Dec 2016 521 +9.5 +1.86%

Hard Red Wheat Mar 2017 533.25 +9.25 +1.77%

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