On Friday, USDA released their annual June acreage report which outlines how many acres of each crop are intended to be harvested in the fall. According to AgriTalk host Chip Flory, while the immediate reaction to the report was mixed, the trade focus quickly turned to weather.
“When we talk the acreage report, let's go all the way back to March and the planting intentions report to put some perspective on what these numbers really mean,” he said. “When we got the perspective plantings report everybody's attitude was ‘we're missing anywhere from a million and a half, maybe as much as two and a half million acres from the total crop mix.’ Well, we found them.”
Corn acres were up 1.1 million compared to march intentions, soybean plantings wer eup 575,000 acres compared to intentions, cotton acres increased by 50,000 acres and 600,000 acres of Spring wheat were added compared to intentions.
“We got all those acres that we thought we were missing back now,” Flory says. “The immediate reaction was kind of mixed.”
According to Flory, the funds have been loading up on the short side of corn and soybeans going into the report.
“I think a lot of this was already anticipated,” he says. “I think all of this has already been factored into the market now we need to look at weather, weather and probably some more weather going forward.”
Flory says the heat coming into the forecast could already be starting to influence the price action in corn.