USDA Planting Report Out of Sync with Trade Expectations
Projections issued by the latest U.S. Department of Agriculture’s (USDA) National Agricultural Statistics Service (NASS) Prospective Plantings Report for the upcoming planting season surprised many in the sector on Tuesday.
U.S. corn acreage is estimated by the USDA to be down 2% from last year to 89.2 million acres – if this decline follows, it would be the lowest corn acreage planted in the U.S. since 2010, following three straight years of decline. Despite the overall decline, the states of Minnesota and Wisconsin are expected to see increased planting. Prior to the report, the average trade expectation was even lower than USDA estimates, standing at 88.7 million acres.
U.S. soybean acreage for 2015 is predicted in the report to be 84.6 million acres – up 1% over last year. This falls below the average trade expectation of 85.9 million acres, as many analysts expect farmers to switch from corn to soy because of falling prices. NASS predicts that increases of soybean acreage of 200,000 or more will occur in Iowa, Ohio, and Arkansas, and the largest declines will happen in Kansas and Nebraska. The states of Kentucky, Minnesota, New York, Ohio, Pennsylvania, South Dakota, and Wisconsin are all forecast to see record soybean acreage this season.
Wheat acreage is predicted to be 55.4 million acres – down 3% from last year with winter wheat down 4% to 40.8 million acres. Of this total, 29.6 million acres will be Hard Red Winter, 7.75 million acres will be Soft Red Winter, and 3.43 million acres will be White Winter. Area planted in other wheat varieties will total 13 million acres, with durum wheat seeing an 18% increase over last year at 1.65 million acres.
Prior to this reports release, The Anderson’s risk management team cautioned that the USDA NASS March 31 report is often not an accurate predictor of plantings, in part because there are so many influencing factors, such as weather, still at play.