Current Marketing Thoughts
Kevin Van Trump has over 20 years of experience in the grain and livestock industry.
Producers weren't too excited about planting more corn acres.
May 28, 2014
Say you assume between 8-10 million acres that have not yet been planted and further assume there are about 1.5 million of those unplanted acres in MN; another 1.3 million in WI; 1.2 million in MI; 1.1 million in OH; 750,000 in ND; and 500,000 in SD you can start to draw your conclusions.
From my perspective if you want to argue from the bullish side of the fence, you could take a stab and say that perhaps 1 million of these acres don't go in the ground as corn. On the flip-side however, I can easily argue that more corn acres than what the USDA has originally estimated from their prevue’s survey were actually planted. Remember, just a few weeks before the USDA took their big acreage survey new-crop corn prices had been trading down around their lows. Since that time however I have heard more and more producers talking about giving the corn another go.
Moral of the story, I suspect any of the acres you lose to the north or the east will be offset by what I consider a conservative early acreage estimate. My hunch is as long as the "weather" plays itself out like the maps below indicate, it will be tough to rally corn in any extended fashion.
Strong demand has to be the saving grace and it's hard for me to see that happening. Keep in mind "exports" have been one of the most surprised blessings and there is now talk surfacing that Argentine corn is being sold at a discount to US corn. There are also reports of Brazilian corn being cheaper than the US corn out past October.
In other words the US might have a tough time winning many additional shipments of corn out past October... Meaning the demand story for US corn might not have much sizzle remaining. This means producers may have to hunker down and remain patient through what could be a more bearish storm than some had anticipated.