April 5, 2021
USDA: Corn and soybean plantings fall below expectations
The United States Department of Agriculture (USDA) projections for corn and soybean plantings fell below expectations by analysts, resulting in soaring future prices for both commodities, Reuters reported.
Lower than projected plantings for US corn and soy would push global food and animal feed supplies concerns, after importers and domestic processors bought up plenty of grain and oilseeds in early 2021.
The United States is the biggest corn exporter in the world and second biggest soybean exporter.
Analysts had projected record combined acreage for both commodities after soybean prices reached a 6-1/2 year high and corn its highest in 7-1/2 years.
The USDA said in its official survey-based look at 2021 US crop area that farmers will sow 91.144 million acres of corn and 87.600 million acres with soybeans. This is the most for corn since 2016 and the most for soybeans since 2018.
But both these numbers are lower than projections from analysts polled by Reuters.
Some analysts doubted the USDA projections as farmers had strong reasons to boost plantings following low crop prices in recent years and the US-China trade war.
According to the latest USDA projections, soybean stocks in the US are estimated to drop to only a 9-1/2 days' supply ahead of the next harvest, with end-of-season corn supplies at its lowest in seven years.
Jim Gerlach, president of U.S. broker A/C Trading, said the US cannot afford that bean acreage total.
Based on an average of estimates gathered in a Reuters poll, analysts were anticipating the report to show farmers planned to plant 93.208 million acres of corn and 89.996 million acres of soybeans.
Scott Gerlt, an economist at the American Soybean Association, said the USDA's March planting intentions report is usually dependable when forecasting final acreage. But of the latest report, he said this intentions report that has a higher than normal error.
Expectations for wheat planting acreage surpassed projections at 46.358 million acres, above a trade estimate of 44.971 million acres. Acreage was 44.3 million acres in 2020 because of an expansion of winter wheat seedings.
First production estimates for the 2021 crops will be released by the USDA on May 12. Revised acreage estimates will be released on June 30 once planting is mostly completed.