The U.S. Department of Agriculture will release its prospective plantings report March 31, which is a survey of more than 80,000 American farmers.
We’ll have coverage of the report online and through Twitter.
The crop market has largely been marking time for the past few weeks waiting for this report.
The consensus going into the report is that U.S. corn acreage will be down a little from last year and soybean acres will jump substantially to a new record high.
Many analysts, based on surveys of their client farmers, have pegged corn at 88 to 88.5 million acres, down about two million from last year and down about nine million from the record area of 97.3 million set in 2012.
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Soybean acres look set for a record at 86 to 87.5 million, up 2.5 million to 3.75 million from last year.
Analysts think farmers will favour soybeans because of lower production costs and a better likelihood of profitability at currently forecasted prices.
The market appears comfortable with the acreage assumption. There is no rally designed to “buy acres.” Prices for the two big crops have been flat for more than month with variation only from currency fluctuations.
There is always a chance for a surprise in the USDA report. Maybe farmers won’t want to stretch their soybean rotations to that extent, even with the lower fertilizer costs.
However, if the USDA survey proves the current market assumptions are sound, then prices will likely continue steady at their unimpressive levels, weighed down by the record large South American crops. Only a weather scare will shake them.
However, weather worries are creeping into the wheat market. Russia’s winter grain crop has dry weather problems, as does the U.S. hard red winter wheat crop.
These concerns caused Kansas hard red winter wheat futures to bounce off the multi-year low set in early March.
But given large year end global wheat stocks, there is a limit to how far the wheat rally can go.
Contact darce.mcmillan@producer.com
