As the weather warms and soils thaw, farmers hone in on planting. With dismal prices compared to previous years, which crops will grab the most acres this spring?
For now, more questions than answers surround the 2015 acreage mix. “The markets are trying to grasp what may happen with new crop production,” says Joe Vaclavik, Standard Grain market analyst. Official state- and commodity-level insight won’t be delivered until USDA's March 31, 2015 Prospective Plantings report.
“There’s a lot of uncertainty right now,” Vaclavik says. “That has left the market directionless. Predicting prices is always an exercise in futility, and this time of year it’s more so than normal.”
Vaclavik knows some farmers are still not 100% committed to what they will plant this year, but corn seems to be the obvious choice in many regions. “There’s really nothing out there you can plant that is really attractive out there in terms of return,” he says.
Muted Grain Prices
The Food and Agricultural Policy Research Institute (FAPRI) expects average corn prices for the 2015/16 marketing year to be $3.89. Average soybean prices are forecast at $9.29 and wheat prices at $5.17. (Read more about which crops FAPRI forecasts to have the best price potential.)
These lower prices are coupled with non-land input prices that similar to 2014 levels, says Gary Schnitkey, University of Illinois ag economist. “Obviously that’s not good news since we are looking at lower revenues,” he says.
These lower profit levels have led USDA to forecast total planted area in 2015 to be 3.3 million acres less than in 2014. “Falling crop prices and narrowing production margins will push some acres out of production even as Conservation Reserve Program (CRP) area continues to decline,” says Rob Johansson, acting chief economist for USDA.
At the USDA’s 2015 Agricultural Outlook Forum, Johansson provided USDA’s acreage estimates for this year:
Corn: 89 million acres
- Corn acreage shows the single largest reduction with area expected to fall 1.6 million acres in 2015, down 8.2 million acres from its recent peak in 2012.
Soybeans: 83.5 million acres
- Soybean area is expected to fall modestly from its record level in 2014, with movement out of soybeans tempered by its lower operating costs and forward marketing opportunities in the past few months.
Wheat: 55.5 million acres
- Wheat area is expected to be down 1.3 million acres.
Cotton: 9.7 million acres
- The all-cotton area is expected to decline by 1.3 million acres or just over 12% from 2014/15 due to weak world demand and world stocks that are equivalent to nearly a year’s worth of consumption.
When will your planting season kick off? Submit your crop plans to firstname.lastname@example.org or share your weather report here: Spring 2015
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