Farming is always a gamble, but when it comes to planting intentions in 2016, there’s no clear pony to pick. For the Delta states of Arkansas, Louisiana and Mississippi, expect midnight decisions as producers make crop selections in relative commodity darkness. In short, producers are forced to fire blind.
“No one farming today has dealt with a farm business environment this dangerous and complex,” says Bobby Coats, an agricultural economist with the University of Arkansas’ Division of Agriculture. “Uncertainty rules near term, so producers, marketers, and agribusiness should be respectful of our economic setting.”
In Arkansas, Coats estimates corn to jump from 445,000 acres in 2015 to 556,000 acres in 2016, and soybeans to drop slightly from 3.17 million acres to 3.09 million acres--a 2.5% cut. He forecasts grain sorghum to take a major hit, 440,000 acres in 2015 to 170,000 acres in 2016, which would be a 61% downward swing. Coats expects cotton to ride a 24% bump, from 205,000 acres in 2015 to 254,000 in 2016.
As for rice (medium and long grain), Coats sees a 12% increase, from last year’s 1.286 million acres to 1.445 million acres in 2016. “Depending on the farm and its financial depth, I would stay with a reasonably typical crop rotation. I really do not see rice having a major economic advantage over soybeans and corn given the anticipated rice acreage expansion over 2015.”
“My advice to producers? Be very respectful of the dangerous economic undercurrents associated with the global economic slowdown and bearish conditions underlying rice, cotton, and grain market fundamentals,” Coats says.
It’s hard to sense where Louisiana crops are headed in 2016, says Louisiana State University AgCenter economist Kurt Guidry. “The crop mix is a big question, and there are no simple choices,” he says.
Guidry believes growers will stick close to typical rotations. Considering estimates for cost of production, five-year state average yields, and current new crop futures prices, corn and soybean projected profitability still look the strongest of available planting options, he says.
Producers generally feel more comfortable and safe with projecting corn yields over soybean yields. Louisiana corn could increase from 400,000 acres in 2015 to 500,000 acres in 2016. However, Guidry’s prediction is based on decent planting weather. If weather delays corn planting, those acres may switch to soybeans. Otherwise, soybean acreage should be flat at close to 1.4 million acres.
With the sugarcane aphid threat and lower overall export demand driving basis levels down significantly, grain sorghum acreage should remain very close to the 77,000 acres of 2015. Louisiana planted roughly 420,000 acres of rice in 2015. Guidry believes rice acres will remain flat to possibly slightly higher in 2016 at 450,000 acres.
Sugarcane is considerably difficult to shift in and out of on a yearly basis, and acres tend to remain constant. It is unlikely sugarcane will see more than a marginal increase from 410,000 acres in 2015. Cotton remains a bigger question. “Cotton is a little bit of a mystery,” Guidry states. “The general feel is we could actually see a 20,000 to 30,000 acre increase from 115,000 acres in 2015.”
“Confusion is the word,” says Bobby Golden, rice and soil fertility agronomist with Mississippi State University Extension. “There are simply a lot of guys unsold on their final acreage.”
Mississippi growers harvested over 2.2 million acres of soybeans in 2015, but Golden thinks the number could decline by 300,000 acres to 400,000 acres, translating to bumps for other main commodities. “Cotton and corn acreage will increase by at least 20% for each crop. Rice is a roller coaster ride, but we’ve got a chance for a plus 30% swing in acreage. Grain sorghum will drop from last year’s acreage, but remember, all of these numbers could change tomorrow.”
Recent years of strong commodity prices have made it fairly easy for growers to make a budget to get crop funding, but 2016 is different, Golden says. “Farmers are coming down to last minute decisions on where they can have the best chance to stay profitable.”
Clear as Delta Mud
The 2016 planting season is shaping up as a year when all the dance partners at the cotillion look rough and homely, yet the music plays on and selections are made all the same. The Delta is blessed with a relative abundance of crop options, but there are no clear winners out of the gate in 2016.
Spring Planting 2015: Delta
States: Arkansas, Louisiana, Mississippi
Top contender: Soybeans
Sleepers: Corn and cotton (Arkansas), corn (Louisiana), rice (Mississippi)
Factors to watch: A wet spring or other delays could force farmers to change crops last minute based on growing-degree units.
AgWeb will be publishing more planting preview stories in advance of USDA's Prospective Plantings report, which will be released March 31.