Analysts expect producers to plant one of largest areas ever to corn once winter loosens its grip on the heartland.
Allendale Inc., McHenry, Illinois, released results from its planting intentions survey recently that showed producers could plant the second-largest acreage ever to corn this year of 96.956 million acres, second only to last year’s 97.155 million acres. The brokerage firm further estimates that assuming a trend yield of 156.97 bushels per acre would mean total corn production could hit 13.912 billion bushels, which would be 29 percent larger than last year’s 10.78 billion bushels.
While not as bullish as in its previous acreage estimates, Informa Economics, a private forecasting firm based in Memphis, Tennessee, now pegs corn plantings at a record-high 97.75 million acres, down 1.6% from its January estimate of 99.3 million acres.
"The drought is slowly receding in the western Corn Belt," says Chad Hart, agricultural economist at Iowa State University. However, severe to exceptional drought still has a grip on the majority of the western Corn Belt.
"The eastern Corn Belt could see trend yields on corn, and if the western Corn Belt averages 140 bushels per acre, we are still talking about a whopper corn crop," says Hart. "Unless the drought re-intensifies and moves east again, we are looking at a corn crop of 13 billion to 14 billion bushels. With a trend yield of 164 bushels per acre, corn production could hit 14.5 billion bushels."
Record Soybean Acreage as Well?
According to Allendale’s soybean planting estimates, producers could plant 78.324 million acres of beans, a record-high acreage. Allendale further estimates that a trend yield of 43.35 bushel per acre would produce 3.349 billion bushels of soybeans, the second highest production level on record and 11 percent larger than last year’s 3.015 billion bushels.
Hart expects acreage intended for corn could give way to soybeans as the season progresses. In 13 of the past 20 years, he says, planting delays resulted in fewer corn acres and more soybean acres than the Prospective Plantings report projected.
Informa’s projection for soybean acres of 78.5 million acres is higher than Allendale’s, but lower than its January forecast of 78.8 million.
With record acreage projected for both corn and soybeans, where will the additional land come from? Some will come from pasture, some from small grains, some from cotton, and some from the Conservation Reserve Program, notes Hart.
Stocks Still Tight
Allendale also released estimates for the upcoming quarterly Grain Stocks report. For corn, Allendale put stocks at 5.07 billion bushels, compared with stocks of 8.03 billion at the end of 2012. The firm estimates soybean stocks of 912 million bushels, down from 1.97 billion at the end of 2012. If realized, stocks of both corn and soybeans would be substantially lower March 1, 2012, when corn stocks were 6.023 billion bushels and soybean inventories were 1.375 billion bushels.
"The Grain Stocks report will be really interesting," says Hart. "Stocks for both crops are still incredibly tight." If the report holds any surprise, it will be that feed demand for corn has not been as strong as anticipated, which means stocks will be larger than expected, says Hart. And that would be bearish for corn prices.
For More Information
AgWeb will continue its pre-report coverage of the March 28 Prospective Plantings report. Here are a few items to read now:
Prospective Plantings Preview: 10 Key States
Gulke’s Pre-Game Picks for the Planting Report
See current market prices in AgWeb's Market Center