Home Farm Equipment Farm Futures survey projects 93.6M acres corn, 88.5M acres soybeans

Farm Futures survey projects 93.6M acres corn, 88.5M acres soybeans

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New producer information from a nationwide March 2021 Farm Futures survey forecasts corn acres to rise 3.1% from a 12 months in the past to 93.6 million acres. Whereas it will be the biggest acreage since 2016 (94.0 million acres), it will solely be the fourth largest corn acreage the U.S. has seen since 1945.

Factoring in a trendline yield of 179.5 bushels per acre with no antagonistic climate occasions, Farm Futures estimates the 2021 U.S. corn crop may whole 15.413 billion bushels, which might greatest 2016’s document haul of 15.15 billion bushels as the biggest in historical past.

 








Commodity

2020 USDA (Ac.)

Farm Futures Estimate (Ac.)

% Annual Change

FF – ‘21 Manufacturing (million bu.)

Corn

90,819,000

93,596,301

3.1%

15,413

Soybeans

83,084,000

88,510,133

6.5%

4,451

Winter Wheat

30,415,000

31,999,119

5.2%

Spring Wheat

12,250,000

11,418,724

-6.8%

Durum

1,684,000

2,192,318

30.2%

Complete Wheat

44,349,000

45,610,161

2.8%

1,851

Would that manufacturing be massive sufficient to ease tightening provides? Factoring in present 2020/21 ending inventory projections, in addition to USDA’s preliminary 2021/22 demand forecasts from the February 2021 Outlook, Farm Futures estimates place 2021/22 ending shares at 1.815 billion bushels. The ensuing stocks-to-use ratio of 12.0% can be a rise from this 12 months’s 10.3% and would probably be the liquidity increase the corn market wants to keep up satisfactory provides.

However these estimates assume quite conservative export figures for each the 2020/21 and 2021/22 advertising and marketing years. USDA has reported a number of weeks of record-breaking corn export volumes over the previous month, with one other sturdy week of loading paces anticipated tomorrow.

And China’s 152.6 million bushels price of latest 2020/21 gross sales final week, to not point out 2020/21 advertising and marketing 12 months up to now transport paces which might be already almost 3.7 instances greater than final 12 months’s cumulative shipments, counsel that USDA is prone to increase corn export targets within the coming months. The probability of a rise rises if Brazil’s safrinha corn crop falls in need of market expectations.

The corn acreage growth may weigh on costs within the brief run, however there isn’t a whole lot of room for error this 12 months. Drought is already outstanding within the Dakotas the place corn acreage is predicted to extend this 12 months.

Soybean provide to stay tight

The March 2021 Farm Futures survey estimates 2021 U.S. soybean acreage at 88.5 million acres, up 6.5% or 5.4 million acres from 2020. Utilizing USDA’s trendline yield of fifty.8 bushels per acre, 2021 U.S. soybean manufacturing would high 4.451 billion bushels.

However coming off a good 2020/21 advertising and marketing 12 months, 88.5 million acres could not resolve soybean scarcity issues presently looming over markets. Given present USDA provide estimates and new crop demand projections, the 2021/22 soybean stockpile will probably solely go away 71.9 million bushels obtainable to be used on the finish of the 2021/22 advertising and marketing 12 months.

That interprets to six days of carryout and a brand new document tight stocks-to-use ratio of 1.6%. USDA projected 90 million acres of soybeans to be planted this spring on the February 2021 Outlook. That additional 75 million bushels undoubtedly gives extra cushion to the soybean market than the Farm Futures estimate.

An uptick in winter wheat acreage does enhance the prospects of double-cropped soybeans to be planted later this spring, however it can battle to maintain up with corn acreage. Plus, a rise in farmer fertilizer and chemical purchases that pushed fertilizer costs greater since final fall counsel farmers deliberate to plant corn over soybeans.

The brand new crop soybean-corn worth ratio has held regular over the two.5 mark, favoring elevated soybean acres over corn in 2021. However fast corn utilization charges, largely as a consequence of export demand, shifted some soybean acres again to corn after the December 1, 2020 quarterly grain shares report was launched in early January 2021.

Soybean utilization charges are usually not prone to decelerate in 2021/22. Biodiesel demand is growing as extra automakers implement extra sustainable fuels for automobiles. Soymeal provided for livestock feed demand will stay sturdy within the post-pandemic period, supporting one other 12 months of record-setting soy crush charges within the U.S. And China’s hog herd will probably stay hungry for soybeans from the U.S. and Brazil for the foreseeable future.

With demand prospects remaining regular subsequent 12 months, the destiny of 2021 soybean acreage will rely closely on acres outdoors the Corn Belt. And whereas worthwhile spring wheat and sorghum costs may additionally lure acres away, soybean costs probably have essentially the most secure – and doubtlessly most worthwhile – worth flooring among the many three foremost row crops for at the least one other 12 months.

Wheat – the 2021 comeback child?

Farm Futures’ March 2021 survey estimates for winter wheat acreage totaled 32.0 million acres, only a hair greater than USDA’s February 2021 estimate. The 5.2% enhance in winter wheat acreage from 2020 – the primary enhance in U.S. winter wheat acreage in eight years – will greater than offset a 6.8% lower in 2021 spring wheat acres.

Spring wheat acreage is forecast to shrink almost 7% to 11.4 million acres as producers within the Northern Plains look to reap extra earnings from corn and soybeans this 12 months. However white wheat growers within the Western U.S. will probably have the final say on spring wheat acreage.

Chinese language demand will probably increase U.S. white wheat exports to 245 million bushels in 2020/21 – the very best quantity since 1994. White wheat, primarily grown in Western states, may present farmers one other worthwhile crop various amid blistering export paces to China this 12 months.

Complete wheat acreage is projected at 45.6 million acres this 12 months, up 2.8% from 2020. The projected rise in winter wheat and durum acres will carry the primary enhance in U.S. wheat acreage since 2014. However manufacturing estimates of 1.851 billion bushels may tighten provides, particularly amid fast export demand and winterkill injury to wheat crops through the February chilly snap.

Winter wheat acreage circumstances are bettering due to latest snowfall and rain throughout the Central and Southern Plains. But when February winterkill injury is critical, wheat acres are prone to put up one other sturdy struggle for acreage in 2022.

Origins of a rally

Farm Futures estimates that acreage for corn, soybeans, and wheat will whole 227.7 million acres in 2021, up 9.5 million acres or 4.3% from 2020. A big portion of “new” acreage is prone to be recovered from 2020 forestall plant acres, which have been among the many highest in historical past final 12 months.

Almost 6.2 million acres of forestall plant corn have been reported in 2020, the second largest on document following 2019’s 11.4 million acres. Soybean forestall plant acres totaled 1.5 million in 2020, the fourth largest in U.S. historical past. The soggy begin to final 12 months’s planting season within the Northern Plains additionally diverted 1.3 million wheat acres into forestall plant acreage.

Excessive commodity costs for all three crops additionally drove the acreage shift – 82% of farmers are planning on altering their crop rotations this 12 months to money in on worthwhile returns in keeping with information from the March 2021 Farm Futures survey, which garnered responses from 1,061 farmers through e mail in late February by early march.

USDA’s World Agricultural Outlook Board reported 26% of winter wheat, 78% of spring wheat, and 90% of durum wheat manufacturing areas have been in areas experiencing drought circumstances as of per week in the past. Enough rainfall will probably be extra essential to 2021 yields than probabilities of a late spring frost. Because the 2020/21 La Niña climate sample begins to weaken, the drought-plagued West and Excessive Plains may see some aid.

Barring any antagonistic climate occasions, anticipate these acres to be put to good use this spring. As at all times climate stays the most important wild card within the 2021 rising season and with tightening corn and soybean provides, favorable rising circumstances might be essential to boosting provides.

Costs have responded bullishly to tightening grain shares over the previous 12 months. Whereas an acreage growth would cut back upward worth mobility, international and home demand for U.S. grains could hold the rally going. For a way lengthy, nobody can say.

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