April 1, 2011

 

US 2011 corn acres set to grow, soy land to decline

 

 

US farmers will be planting 92.178 million corn acres this year, a 5% rise against 2010, while land going into soy production is seen to dip slightly, the USDA said Thursday (Mar 31).

 

"Planted [corn] acreage is expected to be up in most states compared with last year due to higher prices and grower expectations of better net returns," the USDA said.

 

The new corn planting forecast is also slightly higher than the 92 million acres USDA predicted in late February during its annual outlook conference and surpassed most analysts expectations.

 

Future prices for corn recently traded above 2-1/2-year highs on strong global demand and worries about low supplies.

 

And the USDA confirmed in a separate report Thursday that there is indeed a tight market. The Grain Stocks report that showed corn stockpiles across the US total just 6.52 billion bushels, 15% less than about a year ago on March 1, 2010.

 

Soy stockpiles are also lower than a year ago, but the drop wasn't as steep. Soy stocks, whether stored on farms or off, total 1.25 billion bushels. That's a 2% decrease from the 1.27 billion bushels of stockpiles about a year ago.

 

Soy supplies are still tight though and global demand, especially from China remains high, according to analysts surveyed by Dow Jones Newswires. China has become the largest foreign market for US agriculture goods and its appetite for US soy continues to grow.

 

The USDA predicted Thursday that soy acreage this year, although expected to drop about 1% last year, will still be the third largest planted crop ever in the US.

 

Farmers are forecast to plant 76.6 million acres with soy this year, down from 77.404 million acres in 2010 and 77.451 million acres in 2009.

 

But analysts were still expecting the USDA report to confirm that some farmers are switching soy acreage over to corn or even cotton, which has seen strong increases in futures prices in recent months thanks to expected production declines in China and Pakistan.

 

The USDA also released an increase in its forecast for the acreage farmers will plant with wheat. The new prediction is for 58.021 million acres and that's about an 8% increase above the 53.603 million acres planted this year.