USDA on Feb. 15 projected 2024/25 US corn acreage at 91 million acres, down 4% from the year-ago 94.6 million and below the 91.6 million estimate from a Bloomberg survey of analysts.
Corn
is expected to see lower production, greater domestic use, increased exports,
and higher ending stocks, with production projected at 15.040 billion bushels,
down about 2% from the prior year’s record.
Domestic inventories of corn are seen ballooning to 2.53 billion bushels
(roughly 64 million mt) by the end of the 2024/25 season, according to the USDA
forecast. That would mark the largest year-end stockpiles since 1987. Ending
stocks for wheat and soybeans are also poised to grow.
One of the factors driving the higher US stockpiles is Brazil’s growing relationship with China, said Seth Meyer, the USDA’s Chief Economist, in remarks the Agricultural Outlook Forum in Washington, D.C., on Feb. 15.
As inventories rise, farm prices for corn are seen falling 8%, to an average of $4.40 per bushel in the next season, USDA said, with soybean prices slipping 11% and wheat dropping sharply by 17%. Corn, wheat, and soybean futures slid on the Chicago Board of Trade after the announcement. The Bloomberg Grains Spot Index has fallen nearly 30% over the past year.
Soybean acreage is expected to grow to 87.5 million acres from the year-ago 83.6 million. The increase was attributed to stronger demand for domestic crush, largely driven by the growth in biofuel use. Exports likely face competition from supplies in South America during the 2024/25 marketing year.
Wheat acres are projected to drop to 47 million from 49.6 million, with the decline due in part to relatively favorable prices for competing crops such as cotton and sorghum, USDA said. Sorghum acreage is expected to drop to 7 million from the year-ago 7.2 million.
The three major crops combined have a total of 225.5 million acres, down about 1% from the year-ago 227.8 million acres. USDA said this reflects lower prices and a reversion to a more typical level of prevent plant acres.
Rice planted acreage is expected to be level at 2.9 million acres as higher long-grain acreage is almost offset by a reduction in medium- and short-grain acreage. The season is starting with higher supplies due to larger beginning stocks and record-high imports. Despite increased exports and domestic use, USDA said rice ending stocks are projected to reach the highest level since 2014/15.
Cotton acreage is forecast at 11 million, up 7.5% from the year-ago 10.2 million acres. Domestic mill use is expected to remain unchanged, while exports are projected to be higher, reflecting the recovering US production level and share of global trade. Ending stocks and the stocks-to-use ratio are also projected to be higher.