WASHINGTON, D.C. (Reuters) -Farmers in the United States are expected to favour corn over soybeans this year due to better yield prospects and increased ethanol demand, says the U.S. Department of Agriculture.
The prospective planting survey report won’t be out until the end of March, but the USDA forecast at its annual Outlook Forum that corn planted area would be 80.5 million acres in 2003, up about 1.5 million acres from last year.
“Much of the gain is expected because of farmers switching from soybeans to corn in parts of the Midwest due to higher expected returns for corn,” USDA said.
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U.S. soybean plantings are projected at 72.2 million acres, down about 1.5 million acres from 2002.
“Given better yield prospects for corn and attempts to reduce disease and pest problems, there are indications some corn belt producers are planting two consecutive years of corn followed by one year of soybeans,” the USDA said.
Dale Gustafson, senior grain analyst for Salomon Smith Barney, forecast about one billion bushels of corn would be used to meet domestic ethanol demand this year.
U.S. corn exports are estimated to increase, but could face stiff competition from Argentina and China.
“The export outlook for corn remains dismal,” Gustafson said. “There is no indication at this point that China is planning to slow its export sales program for the summer period.”
Wheat plantings are forecast at 63 million acres, up from 60.4 million acres, the USDA said.
