A lot can change between Thursday’s USDA Prospective Plantings report and the time when plantings are complete, but the report apparently caught many traders flat footed.
The biggest surprises appeared to be that farmers planned to plant a record number of acres to soybeans and were earmarking fewer acres to corn and spring wheat than were expected. It also would be the third time in history that more acres are going into soybeans than corn, market analysts said.
March 1 corn, soybean and wheat stocks were said to be in line with pre-release estimates.
Corn futures moved higher after the report’s release, while soybeans and wheat futures faded. The report indicated tight supplies of corn were in store if farmers don’t change their minds and switch some acres back to corn.
CORN ACREAGE TAKES A HIT
Despite the current high corn prices, US farmers said they intended to plant 89.490 million acres this year, down 3.867 million, or 4.14%, from 93.357 million last year.
Major corn-producing states like Illinois, Indiana, Iowa, Nebraska and Ohio all posted declines in prospective plantings this year. Illinois farmers said they expected to plant 10.700 million acres to corn, down 300,000, or 2.73%, from 11.000 million last year.
Indiana farmers indicated plans to plant 5.100 million acres to corn, down 300,000, or 5.56%, from 5.400 million last year, while Iowa growers said they intended to plant 12.600 million acres to corn, down 300,000, or 2.33%, from 12.900 million last year.
Nebraska producers plan to plant 9.700 million acres to corn, down 200,000, or 2.02%, from 9.900 million last year. And Ohio farmers said they had marked 3.350 million acres for corn production, down 200,000, or 5.63%, from 3.550 million last year.
MORE SOYBEAN ACREAGE PLANNED
US farmers said they planned to plant 90.955 million acres to soybeans this year, up 3.760 million, or 4.31%, from 87.195 million last year. If realized, this would best the previous record of 90.200 million acres set in 2017, market analysts said.
Soybean acreage was expected to be higher in most producing states. Illinois farmers said they expected to plant 11.000 million acres to the legume, up 400,000, or 5.66%, from 10.600 million last year.
Indiana producers hoped to plant 5.900 million acres to soybeans, up 250,000, or 4.42%, from 5.650 million last year. Iowa growers said they intended to plant 10.400 million acres of soybeans this year, up 300,000, or 2.97%, from 10.100 million last year.
Ohio producers had 5.100 million acres marked for soybean production this year, up 200,000, or 4.08%, from 4.900 million last year.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $138.00 to $140.00 per cwt, compared with last week’s range of $136.00 to $141.52. FOB dressed steers and heifers went for $216.58 to $2 per cwt, versus $216.09 to $220.18.
The USDA choice cutout Thursday was up $1.35 per cwt at $268.39, while select was up $4.88 at $262.34. The choice/select spread narrowed to $6.05 from $9.08 with 77 loads of fabricated product and 19 loads of trimmings and grinds sold into the spot market.
The USDA reported that basis bids for corn from feeders in the Southern Plains were unchanged at $1.45 to $1.55 a bushel over the May futures and for southwest Kansas were steady at $0.00 over May, which settled at $7.48 3/4 a bushel, up $0.10 3/4.
The CME Feeder Cattle Index for the seven days ended Wednesday was $155.76 per cwt up $0.35. This compares with Thursday’s Mar contract settlement of $155.90 per cwt, down $0.07 and Apr’s $161.40, down $2.27.