This spring, excess supply is hanging over the US grain markets like a dark cloud.

As of Friday (Mar 19), Chicago Board of Trade December corn, which represents the coming fall harvest, settled up 2.5% on the week at US$4.031/2 a bushel, while November soy settled up 3.1% at US$9.42. The gains were attributed mostly to traders making short-term changes in their portfolios.

The USDA estimates that domestic corn ending stocks -- essentially the surplus -- will total 1.799 billion bushels this year, a figure that is mind-numbingly large, said Spencer Patton, founder and chief investment officer of Steel Vine Investments. While US soy ending stocks are tight at 190 million bushels, record-setting soy crops in South America are pushing global supplies higher.

However, farmers consider more than just grain prices or ending stocks when making crop decisions. Weather is another key. Adverse weather delayed harvests last autumn, meaning some crops were left in the fields and many farmers were not able to finish fieldwork preparations before winter arrived. With spring's arrival in the farm belt, planting delays are possible as farmers play catch-up from the fall and as soils in many areas are oversaturated from melting snow.

Once farmers' planting intentions are revealed, the acreage battle may heat up. Early estimates from private firms suggest that farmers will plant 89-90 million acres of corn in 2010, up from 86.5 million last year, while soy acreage is projected at 77-79 million acres, mainly higher than the 77.5 seeded last season. Most estimates for wheat hover around 53 million acres, down from 59 million last year because farmers planted the smallest winter-wheat crop in nearly 100 years. The USDA will give the official word on planting intentions on March 31.

Regardless of what the March 31 report says, intentions can change.

"The planting intentions are only an estimate, but what Mother Nature allows farmers to do is probably the trump card," said Brian Roach, vice president of Roach Ag Marketing, an advisory service and brokerage. If a wet spring-weather pattern sets in, as it did in the past two seasons, farmers could shift away from corn, since it requires more field preparation prior to planting, as well as more time to grow, Patton said. If that happens, soy or cotton could pick up extra land.

Planting delays do not necessarily translate into poor harvests, Roach and other analysts point out. Last year's corn crop is a prime example: despite being planted extremely late, the harvest totalled a record 13.151 billion bushels.

Whether the intentions revealed at month's end blossom into reality will not be known until June's end, when the USDA issues actual planted-acreage data.