Friday, the USDA released its Acreage and Grain Stocks reports, which provided little support for corn and soybean prices, said Todd Hubbs, from the Department of Agricultural and Consumer Economics at the University of Illinois at Urbana-Champaign in the university’s publication “farmdoc daily.”
Trade policy jitters and weather remain the major price movers, but growth in principal crop acreage was the main revelation in Friday’s USDA reports. The implication was more production as sales opportunities dwindled.
Corn and soybean futures prices continued to fall on Monday amid fears of a growing trade war with major export customers, market analysts said.
Total principal crop acreage came in at 322.1 million, up 4.1 million from the March Prospective Planting report, Hubbs said. Principal crop acreage estimates increased by 2.9 million over 2017, and significant increases over the March planting intentions occurred in hay (1.4 million acres), corn (1.1 million acres) and spring wheat (575,000 acres).
However, despite the increase in corn acreage from March, reported corn and soybean planted acreage was down 1.6 million from last year to 178.7 million, he said.
CORN PLANTED ACREAGE GROWS
Corn producers reported they planted 89.128 million acres of corn this year, 1.03 million less than was planted last year, Hubbs said. Corn planted acres came in 1.1 million acres larger than the March Prospective Plantings report’s 88.0 million.
When compared with the March Prospective Plantings report in major producing states, the June survey showed higher corn acres in North Dakota (300,000), Minnesota (300,000), Kansas (300,000) and Nebraska (400,000), he said. Acreage was lower than the March intentions report in South Dakota, (500,000) and Texas (100,000), offsetting the gains in the western Corn Belt.
Major corn producing states in the eastern Corn Belt saw slight to no changes from the March intentions report, Hubbs said.
The projection for corn acreage intended for harvest sits at 81.8 million acres, Hubbs said. 0.9 million less than was harvested in 2017. Yield is challenging to predict at this point in the growing season, but the strong start to the year indicates potential yield likely is above the USDA’s June assessment of 174 bushels an acre, he said. Corn production this year may range from 14.1 and 14.4 billion bushels.
CORN STOCKS GROW
June 1 corn stocks came in at 5.31 billion bushels, nearly 77 million more than last year and 38 million more than the average trade estimate, Hubbs said. Estimated total disappearance during the quarter was 3.58 billion bushels.
Despite the size of the livestock herd through this marketing year, feed and residual use continue to show disappointing consumption numbers, he said. Estimated third quarter feed and residual use come in slightly lower than last year at 989 million bushels.
CATTLE, BEEF RECAP
Three hundred six head of fed cattle sold Wednesday on the Livestock Exchange Video Auction at $106 per cwt, down $4 from the previous Wednesday’s $110.
Cash trade was reported Wednesday at $106 per cwt on a live basis, down $2 to $4 from the previous week, and at $168 to $170 on a dressed basis, down $3 to $4. On Friday more cattle sold at $107 to $108 per cwt live, down $1 to $2.
The USDA choice cutout Monday was down $0.08 per cwt at $211.88, while select was up $0.20 at $198.77. The choice/select spread narrowed to $13.11 from $14.42 with 111 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Friday, was $142.67 per cwt, up $0.67. This compares with Monday’s Aug settlement of $151.92, up $0.60.