2012: Biggest Corn Acreage in 68 Years?

February 26, 2012 08:37 PM
 

 

This year looks to be a record-breaker for acres planted in the U.S.

 
At last week’s Agricultural Outlook Forum, Joseph Glauber, USDA’s chief economist, released figures for 2012 plantings and crop price prospects.

 

Glauber says expected returns for soybeans and corn will again be historically high, reflecting strong new-crop futures and cash forward prices.

 

Here are USDA’s projected acres for 2012:
 
2012 Planted Acres 
(click to enlarge)
 
CRP enrollments for 2012/13 are down, USDA reports. Total projected CRP area is 30 million acres, 6.8 million acres lower than at its peak enrollment in 2007/08.
 
The lower CRP enrollment is helping boost many crops’ acreage for 2012. Corn plantings are estimated at 94 million acres – the largest plantings since 1944.

 

Soybeans are projected at 75 million acres, unchanged from 2011, but down 1.6 million from last year’s intentions.

 

Wheat acreage is expected to increase 3.6 million acres to 58.0 million. Winter wheat area at 41.9 million acres, is up 1.3 million from last year. Spring wheat plantings should rebound from last year’s levels when excessive spring and early summer wetness limited seedings.

 

Cotton acreage is expected to decrease to 13 million acres.

 

Rice will make a slight increase to 2.8 million acres.

 

Lower Prices Projected

Glauber says farm prices for most field crops will be lower, reflecting larger world and domestic supplies.
 
Here are USDA’s price predictions:
Crops
2008/09
2009/10
2010/11
2011/12
2012/13F
% Change
2011-12
Wheat
6.78
4.87
5.70
7.30
6.30
-13.7%
Corn
4.06
3.55
5.18
6.20
5.00
-19.4%
Soybeans
9.97
9.59
11.30
11.70
11.50
-1.7%
Rice
16.80
14.40
12.70
14.20
14.70
+1.3%
Cotton
47.8
62.9
81.5
90.0
80.0
-11.1%
 
Wheat, corn and soybeans in dollars per bushel; rice in dollars per hundredweight; cotton in cents per pound. Numbers in red denote record levels.
 
Market expert Jerry Gulke says the figures from USDA show that demand will be increased for U.S. grain, saying prices are going to be low enough to increase demand.
 
"If you don’t have enough, the market goes up enough to curb demand. If you get too much, the prices go down and you buy back that demand. You usually curb demand with high prices better than you can buy back demand."
 
Gulke says the Outlook Forum's estimate provide a baseline, and more vital information will be coming in the March 30 reports.
 
 
 

 

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