USDA will release their much-anticipated Prospective Plantings report on Monday. Unlike previous acreage predictions, this data comes from farmer surveys. Jim McCormick, co-founder of agmarket.net, believes that report will show farmers intend to plant more corn this spring than initial reports estimated.
“The USDA Outlook Forum was at 94 million. When we looked at the numbers and how we generated this data, we interviewed producers. We also talked to our cohorts over at John Stewart and Associates about what their commercials are seeing. We’ve also talked to a lot of seed sellers, and they’re seeing this across the board. The demand for corn is ferocious. There are some genetics in certain areas of actually run out because that demand is so strong. And hence, that’s what we think, when it’s all said and done on the 31st they’re going to come in at least at 95.39 million acres.”
McCormick says it’s all about profit opportunities in corn that aren’t there for soybeans.
“When you look at the spring price of corn, it’s a nickel where it was a year ago, while beans are $1 below a year ago. The fact of the matter is, when you look at the current price of beans, no one’s making money. The cost of money where it is, does it make a lot of sense to borrow a bunch of money to plant a crop that, at this point, you’re almost guaranteed to not make money, where, at least on the corn, it feels like you got a fighting chance, or at least you are making some money. It may not be great, but the profitability is there, and that’s why those dynamics say the corn acres are going to be up and bean acres are going to be down.
As for wheat, McCormick says agmarket.net’s estimate is higher than USDA’s by about 800,000 acres.
Source: NAFB News Service
