Acreage Preview: Could Soybean Acres Dominate for the Second Time?

June 30, 2017 06:00 AM

The U.S. Department of Agriculture (USDA) is releasing its June acreage report Friday afternoon to give producers a look at the acreage mix this year.

USDA forecasted a record amount of soybean acres in March, almost even with anticipated corn acres for the year.

The eastern Corn Belt had a wet and difficult spring with planting dates ranging from April to June.

One word could describe this growing season thus far and thatchallenge,’” said Mike Silver, senior grain merchandiser for Kokomo Grain in Kokomo, Ind.

Kent Eddy, a farmer in northwest Ohio, knows the word well. He had to replant multiple times in certain fields.  

[I replanted] up to three times, said Kent Eddy, who farmers near Van Wert, Ohio. Thats not uncommon. 

Eddy even switched some of his corn acres to soybeans. 

We dropped about 20 percent of our corn acres and just went to soybeans because it wasnt planted yet, said Eddy. 

In March, the USDA projected 2017 soybean acres to be at historic levels- 89.5 million acres. That
s roughly 500,000 acres less than corn. Now, the debate is whether the next report could show if soybeans will dominate for the second time in recorded history.

[U.S. soybean acres surpassed corn] one other time in 1983, said Chris Hurt, agricultural economist at Purdue University. That was the year of the -Payment-in-Kind- (PIK) program where the federal government paid farmers to not plant up to 25 percent of their acreage that year due to big surpluses in the United States.

In my opinion, you will still have more bean acres than corn acres, but Im not seeing a gigantic switch by any means, said Matt Bennett, owner of Bennett Consulting. I could see maybe a 90.25 to 90.5 million soybean acres, whereas corn will come in below where intentions were but not significantly below like some people have suggested. 

The discussion varies between different areas of the Corn Belt. Rex Williamson, agent of Williamson Insurance Agency in Payne, Ohio says he has not processed many acreage reports, but estimates more bean acres in his area.

[I estimate] 60 to 40 percent [ratio heavy soybeans] or 65 to 35 percent [ratio heavy soybeans], said Williamson. Were seeing substantially more soybeans than corn.

Williamson estimates at least one-third of corn acres in northwest Ohio have been replanted due to a soggy spring. Total replant acres are high, too. 

At this time, we have over 1,700 replant claims filed right now, said Williamson.

However, he says not as many fields went to beans as he anticipated.

The crop insurance rules this year are clear that if you tear up a corn field and plant it to soybeans instead, then the insurance is not attached on that corn and theres no premium or coverage for it, said Williamson. Then, the soybean crop is insured, assuming you have beans insured.

In Indiana, Kokomo Grain is preparing for a harvest with the thought of potentially having more soybeans in storage than in the past.

With the wet weather weve had, I think we even have less corn acres and more soybean acres than what was originally intended, said Williamson. 

Silver is also in the crop insurance business. He says replant claims this year are the highest he
s ever seen.

Weve had hundreds and actually thousands of acres by individuals and their operations replanted this year, said Silver. Thats just not the normal situation for Indiana.

Eastern Corn Belt farmers have to adjust to the weather and work through a puzzling market this year

To me, [the markets dont] make sense, said Eddy. Looking at what I see and hear, [its hard to believe the corn] is where its at price-wise and beans too. There are so many small beans.

Farmers hope the window for harvest wont be as small as it was for planting.

Hurt says the movement to soybeans isnt just due to a wet spring but also soybean demand and population growth in China. 

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