Could North and South Dakota Be Sitting on 1 Million Acres of Prevent Plant?

The Corn Belt made major planting progress the past two weeks, nearly catching up to the five-year average planting pace. The exception is in portions of North Dakota, South Dakota and Minnesota where a wet spring continues to plague producers, but that story is also changing with improved planting conditions creating a last-ditch opportunity to plant.

According to USDA’s Crop Progress report, North Dakota has a lot of catch-up to do, with 56% of the state’s corn planted as of last Monday. Only 23% of the state’s soybeans had been planted and less than 50% of the spring wheat.

Tommy Grisafi of Advance Trading and Don Wick of Red River Farm Network teamed up for a “Boots on the Ground” tour of North Dakota and Minnesota this week.

Grisafi says the weather turned more favorable on Friday, with farmers more optimistic about getting their crops planted yet this year. As he toured North Dakota, he saw planter after planter start to hit the field. In some areas, farmers actually held off planting corn and soybeans, putting a priority on sugarbeets this year.

However, he points out that no matter how much headway is made, there will be fields that won’t get planted due to water still standing in them, especially in the northern portion of the Red River Valley. He thinks between North Dakota, South Dakota and Minnesota, there will be as much as 1 million acres of prevent plant this year. That number would have been more if the weather hadn’t opened up to start the weekend.

“People were stressed out this spring,” says Grisafi. “You have a perfect situation where you could be massively profitable this year if you’re in the bushel business and produce a crop. Instead, you’re seeing preent plant in North Dakota anywhere from 800,000 to 1 million acres. Even if there’s 1.5 million acres of prevent plant, keep in mind that if you look at history, that’s normal.”

Options to Plant

Grisafi says growers in the northern Corn Belt are exploring other crops to possibly grow. He says late-planted corn could be a disaster for farmers this fall, especially with natural gas prices so high. That’s why farmers are looking at crops like sunflowers,

“They grow a lot of canola up in northern North Dakota and Canada and other specialty crops that farmers elsewhere in the U.S. don’t,” Grisafi says. “We’re out of supplies here in North Dakota. We are flat out of grain. We have a positive basis in North Dakota, which used to be the armpit of the world. It is now a hot cash market. There’s still water in the fields. This story is not over yet.”

Grisafi says the northern Red River Valley is in the worst shape, with some farmers he visited with this week saying half of their ground is still unplanted. He says if the rain can hold off, farmers will be busy planting in fields this week.

Can Iowa and Illinois Make up the Lost Ground?

It’s not a crop disaster everywhere. Farm Journal Field Agronomist Ken Ferrie says even though the majority of Illinois’ corn was planted in May, the crop popped out of the ground in four days, showing some of the best crop stands he’s ever seen. As a result, Ferrie thinks it’s possible Illinois will see record ear counts this year.

Since planting did pick up pace in the “I states,” AgMarket.net’s Brian Splitt thinks those farmers may be able to compensate for the lack of planting in areas such as North Dakota.

“While you may lose that 1.5 million acres, I tend to think that you could see somewhere between 500,000 to 600,000 acres of corn added in the I states to help make up for some of that prevent plant there, just based on the rally that we saw in corn versus soybeans leading into the planning timeframe,” says Splitt.

Even with the push to plant, and the incentive to do so, ending stocks are tight with corn.

“One of the things that we’ll be looking at moving forward is does getting back to somewhat normal pace for corn prompt the USDA to feel like they could potentially put the yield back up closer to their trend model? And does that provide a little bit of cushion on the balance sheet here?” says Splitt.

It’s a Seller’s Market

No matter what USDA does in the upcoming report, or the revisions to acreage produced by NASS at the end of June, Grisafi says farmers are less likely to sell grain this year.

“We have to remember that the farmer will sell grain when they need money,” says Grisafi. “Right now, many farmers don’t need the money. So we could produce a big crop, and it’ll still be in tight hands. Something that hasn’t happened in years is where the American farmer is sitting there with cash and says, ‘Come get it, but at my price, not yours.’”

Tommy and Wick will wrap up their Boots on the Ground Tour Saturday answering a major question this year: will farmers in North Dakota and northwest Minnesota choose prevent plant, adjust maturity or switch to an alternative crop?

The reports are available at www.rrfn.com with additional coverage on Twitter at @rrfn and @trust_ati.