Grain futures trading was limited to four daily sessions this week as the markets were closed for Good Friday. The observance also prompted the Agriculture Department to release a couple of closely watched reports on Thursday.
In its quarterly stocks estimates, USDA pegged corn supplies well above private estimates at 5.4 billion bushels. Soybean and wheat stockpiles also proved to be higher than previously thought and, consequently, the report had bearish implications for all three commodities.
The trade also focused late this week on one of USDA’s most-anticipated reports of the year… Prospective Plantings.
This year’s Prospective Plantings report shows advances and declines split across the four major crops.
Corn remains the champion of the acreage battle at 97.3 million acres. That’s less than 1 percent above what was planted last year and only slightly under the average private estimate this spring of 97.4 million acres. If realized, 97.3 million would be the most corn planted by U.S. farmers since 1936 when 102 million acres were planted.
USDA is predicting a slight decrease for soybeans over last year falling less than 1 percent to 77.1 million acres. That’s just below the average trade guess of 78.5 million acres. If realized, that would be the fourth highest number of acres ever planted in soybeans.
Cotton acreage for 2013 was in-line with private estimates and is expected to fall this year to 10 million acres, down 19 percent from 2012. That continues a trend for U.S. cotton producers who have cut their acreage by nearly 40 percent since 2011.
Total wheat acres are expected to increase, as well, climbing less than 1 percent over last year. The USDA prognostication also is in line with private figures at 56.4 million acres.
All in all, things are shaping up to be eerily similar to last year, before the Grain Belt was hit by the worst drought in five decades. Yet, at its annual Agricultural Outlook Forum last month, USDA called for record corn production of 14.5 billion bushels, up 35 percent from the drought-reduced 2012 crop. Officials further predicted yields would hit a projected 163.6 bushels per acre, up 33 percent from last year.
However, 65 percent of the continental U.S remains in some form of drought. That’s 9 percentage points higher than this time last year, but there may be some relief on the horizon.
While some regions are enduring their third season with inadequate moisture, conditions appear to be easing a bit in the Eastern Corn Belt.
And just like last year, the potential of achieving favorable yields from those acres still hinges, largely, on Mother Nature.