Acreage Surprise: Soybeans Fall Short (For Now)
In its annual Acreage report, USDA estimates corn acres are down from last year and soybean acres are up.
Here are the key 2022 acreage numbers:
- Corn acres are estimated at 89.9 million, down 4% or 3.44 million from last year. This is up from the March estimate of 89.490 million acres and close to the pre-report trade average of 89.861 million. Compared with last year, planted acreage is expected to be down or unchanged in 35 of the 48 estimating states.
- Soybean acres are estimated at 88.3 million, up 1% from last year. This is down from March’s estimate of 90.955 million and below the pre-report trade average of 90.446 million. Compared with last year, planted acreage is up or unchanged in 24 of the 29 estimating States.
- Wheat planted area for 2022 is estimated at 47.1 million acres, up 1% from 2021. If realized, this represents the fifth lowest all-wheat planted area since records began in 1919. The 2022 winter wheat planted area, at 34 million acres, is up 1% from last year, but down 1% from the previous estimate.
- Cotton acres are estimated at 12.5 million, up 11% from last year.
“There's no doubt it was a surprise to be at 88.3 million for soybean acres,” says Matt Bennett, co-founder of AgMarket.Net. “We felt like we would pick up a few acres of both corn and soybeans, as both prices were rather competitive. I think when it's all said and done, we just ran out of total acres.”
"The industry was assuming USDA was on the bottom end of the survey or range on corn and on the upper end on soybeans, and USDA confirmed that,” adds Arlan Suderman, chief commodities economist with StoneX. “But soybeans came down even more than expected. That takes off about 150 million bushels worth of production potential going forward. Therefore, it really tightens up the new-crop balance sheet a lot more."
Quite a roller coaster in #soybeans today. Keep in mind the broader markets are in a "risk off" mode today. That pulled #corn & #wheat notably lower when they failed to have bullish support from USDA. Beans gave way to that, after the initial rally, but then fought back. #oatt — Arlan Suderman (@ArlanFF101) June 30, 2022
USDA's Grain Stocks Report Shows Farmers Are Holding Onto Old Crop Corn And Soybeans
When prices are high, he says, typically acres go up for everything.
“We've still got total acreage fairly close to 180 million,” Bennett says. “But at the same time, I thought we would be above 180 million for corn and beans simply due to the fact prices are so high.”
However, compared to the March planting intentions report- farmers choose to move out of soybeans and into corn. pic.twitter.com/N7NHV1KoV5 — Ben Brown (@BenBrownMU) June 30, 2022
Listen to Brian Splitt break down the June 30 reports with Chip Flory on AgriTalk:
Will Acreage Numbers Still Rise?
In July, NASS will collect updated 2022 acreage information for North Dakota, South Dakota and Minnesota due to planting delays. In the Acreage report, USDA estimates 4 million acres of corn and 15.8 million acres of soybeans were left to be planted, based on farmer responses collected from May 28 to June 16.
“We still had quite a bit of crop that was not planted when this survey was going on,” says Randy Martinson, market analyst with Martinson Ag Risk Management. “We will see some adjustments moving forward. But it will likely not show up until the August Crop Production report.”
Going forward, he says the grain markets will focus on the weather forecast.
“The markets maybe pulled too much weather premium out of the corn, soybean and wheat markets,” he says. “We still have a lot of growing season left, so we’ll continue to trade weather. Overall, I think it is a bearish weather report. We’ll see if that holds once we come back Tuesday.”
Bennett agrees. The current acreage mix means there’s not much room for a production error.
“Mother Nature is really going to have to get along well with us through the months of July and August or it could be a pretty dicey situation,” Bennett says.
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USDA cuts soybean plantings estimate sharply below trade expectations
