November 12, 2010

US corn sowings to approach highest since 1940s

Corn sowings in the US, the biggest grower of the grain, are to approach their highest since World War II as farmers cash in on robust prices, analysts said.

Analysts had raised their forecast by 2.7 million acres to 93.1 million acres for American corn plantings next year, implying an extra 4.9 million acres of sowings.

Sowings at that level would be only some 400,000 acres short of the post-war high set three years ago, as corn prices ran up in the last bull market.

And they would come in part at the expense of soy plantings, which analysts estimated at 75.8 million acres, down 1.6 million acres on their last forecast, and 1.9 million acres fewer than farmers sowed this year.

The corn estimates were viewed by Don Roose, the president of broker US Commodities, as an indication of the enthusiasm among growers to cash in on a market offering them "bottom line" profits of $300 an acre from the grain.

However, the extra production would lift plantings at this level, and would return US corn inventories back above the key 1 billionn bushel mark by the end of 2011-12, assuming a trend yield and current demand levels, Roose added.

Corn for December closed 0.5% lower at US$5.64 a bushel in CBOT. Soy, meanwhile, ended US$0.115 higher at US$13.21 a bushel for November, on the thought of supplies remaining tight.

The report estimated wheat acres at 56.1 million acres, down 900,000 acres from the previous estimate, and still weak by historical standards, but a rise nonetheless on-year.

US wheat plantings for this year's harvest were, at 53.6 million acres, the lowest since 1970.