|By TIM ALEXANDER
CHICAGO, Ill. — The USDA/NASS annual Prospective Plantings report, issued Friday, calls for U.S. farmers to plant a record 76.895 million acres of soybeans during the 2006 season, up 7 percent from last year.
The report also projects that 78.019 million acres will be devoted to corn, the smallest acreage amount since 2001 and 5 percent less than 2005’s acreage total.
In Illinois, farmers are expected to plant 11.4 million acres of corn, down 6 percent from last year, and soybean acreage is expected to rise by 6 percent to 10.1 million acres.
According to one Chicago grain trader, the larger-than-expected drop in corn acres projected in the report is a “landmark” event. Jim Bower of Bower Trading said during Friday’s Chicago Board of Trade (CBOT) press briefing that in his 30 years of trading, he’s never seen the trade estimate for corn plantings appear so far from USDA’s estimates.
According to Bower, the last time the two estimates were so far apart was in 1989 and CBOT corn futures later rallied 20 to 25 cents. “Obviously it’s a shell-shocked market,” Bower said. “These numbers have to be gone through, dissected, looked at, massaged … and look at how the weather’s going to change and go from there.”
Meteorologist Greg Soulje told news sources that spring planting conditions could be extremely volatile, and that drought conditions continue to plague parts of Illinois and the country.
“The drought, by the way, is not over with. In our estimate, it’s likely to re-intensify,” said Soulje, adding that rains likely to occur in coming weeks will help recharge topsoil moisture across much of Ill. but likely won’t do much for subsoil moisture levels.
Darrel Good, extension economist for the University of Illinois (UOI), said earlier in March that most analysts were on record as predicting the decline in planting intentions for corn and increase in intentions for soybeans.
“The debate generally centers around the magnitude of these changes,” Good said in his Weekly Outlook, published by the UOI’s College of A.C.E.S.
“Acreage of spring-planted crops, however, could deviate from intentions due to escalating spring wheat prices, potential for abandoned hard red winter wheat acreage to be replanted to other crops, changes, if any, in price relationships of spring planted crops, and spring weather conditions.”
Scott N. Davis, CCA, strategic development manager for Trisler Seed Farms, Inc. said farmers his company works with would react differently depending on geography and economic factors.
“Certain regions of the country are more likely to switch from corn to beans, for example southern Indiana and southern Illinois,” Davis said. “These regions are typically lower-yield environments with much more risk, so a few more of these farmers are switching from corn to beans.
“The other factor is economics. Many farmers that are financially strapped are switching to beans due to a lower input cost, even though a lot of the market fundamentals still favor raising corn. Where the farmers are in a better financial position, I actually see decisions being made to reduce bean acreage and go more corn-on-corn. Despite the higher input cost, these farmers are trying to take advantage of stronger corn demand and higher potential returns next fall.”
To view the complete USDA Prospective Plantings report, see its NASS website at www.nass.usda.gov
This farm news was published in the April 5, 2006 issue of Farm World.