USDA’s end-of-March Prospective Plantings report always brings a few surprises. This year will likely be the same, when USDA releases its report at 11 a.m. CDT on Friday, March 29.
The big question will be, how much water do these acreage estimates hold?
“This report that comes out on Friday was theoretically based on March 1 intentions—four weeks before the report comes out,” says Jerry Gulke, president of the Gulke Group. “What were the conditions back then? Well, we didn't have 70% of Nebraska underwater. So, I suspect that the report that comes out on March 29 isn't going to be worth much more than the paper it's written.”
Gulke adds that the Prospective Plantings report is based on farmers’ planting intentions—emphasis on intentions. “What we really decide and can do this spring, given Mother Nature, is a moving target at this point.”
Flooding is happening from Canada to Missouri and from Nebraska to Indiana, and the stage is set for record flooding from now through May. Around two-thirds of the 48 contiguous states are at risk for flooding, according to experts in a recent Bloomberg article.
At its annual Agricultural Outlook Forum in late February, USDA forecast U.S. farmers will plant 92 million acres of corn, which is a 3.3% jump from last year, and 85 million acres of soybeans, which is down 4.7% from last year.
Gulke says the Prospective Plantings report will likely be the high-water mark for corn and the low-water mark for soybeans.
“I think that can general consensus will be that whatever the corn number is in the report, actual acreage won't end up being that high,” he says. “And soybean acreage won’t end up being as low as they are in Friday’s report. We probably won’t cut 4 million to 5 million acres of soybeans compared to last year.”
Gulke says this scenario should be friendly to corn. After this week’s report, he says, weather will become the market’s focus.
“We’re running out of time,” he says. “Commentators like to say that farmers only need eight to 10 days to plant their crops. But, can we get a week to 10 days of good weather in order to get the ground fit? It's going to make it a little more difficult to determine the price outlook for a while, probably until June 30 when we see what type of crop we have growing.”
Gulke will analyze the Prospective Plantings and Grain Stocks report on Friday, March 29. Visit agweb.com/Gulke.
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