USDA to show higher soybean acreage, analysts say

(Agriculture.com) – U.S. government forecasters on Friday are likely to raise their estimates of the country’s planted corn and soybean acreage by 0.1% and 2.3%, respectively, according to analysts polled by Dow Jones Newswires.

Analysts on average expect the U.S. Department of Agriculture, in the results of a survey of farmers to be released Friday at 8:30 a.m. EDT, to forecast U.S. corn plantings of 95.96 million acres this year, up from 91.92 million acres last year and the USDA’s previous forecast of 95.86 million acres.

Estimates given by 18 analysts in the Dow Jones poll ranged from 94.30 million to 96.76 million corn acres.

The USDA has said its previous estimate for planted corn acreage this year would be the highest since 1937.

Analysts on average expect the USDA to forecast soybean plantings of 75.58 million acres, up from 74.98 million acres last year and higher than the USDA’s previous forecast of 73.90 million acres.

Estimates by 18 analysts ranged from 74.50 million to 76.54 million soybean acres.

At the same time as its plantings report, the USDA will also release figures for domestic grain and soy inventories as of June 1.

The pair of reports could cause major price swings in soybean, corn and wheat futures if figures differ substantially from analysts’ projections.

The planting survey is likely to have the biggest influence on prices for deferred futures of those three crops, while the quarterly stocks report will most directly affect nearby futures prices.

Although traders will closely follow the two reports, Farm Belt weather forecasts that morning may have a bigger impact on futures prices, said Rich Feltes, vice president of research for brokerage R.J. O’Brien, in a note to clients.

The government reports come during a week when corn and soybean prices have jumped on expectations that the drought conditions in much of the Midwest will stress crops. December corn futures have risen 14.3% this week, as that crop is entering its delicate pollination phase.

Deferred futures for either corn or soybeans could fall if the USDA estimates planted acreage significantly above analyst estimates, especially if weather forecasts also shift to suggest more rain is possible, analysts said.

Key factors behind the acreage numbers include how many farmers switched to planting soybeans instead of corn due to high soy prices, and how many farmers intended to plant “double-crop” soybeans, or soy crops planted immediately after a wheat harvest. Analysts expect a boost to soy acreage since an early wheat harvest made it easier than normal for farmers to double-crop, but also say growing drought conditions may have discouraged many farmers from going through with double-cropping plans.

For corn acreage, the market may only see a strong price reaction if the USDA’s figure comes in more than one million acres above or below analysts’ expectations, said Larry Glenn, a broker at Frontier Ag Inc., a commodities brokerage firm in Kansas. Otherwise, analysts said, traders of deferred corn futures may continue to focus more on weather forecasts.