The U.S. Department of Agriculture (USDA) on Feb. 18 said U.S. corn growers will likely plant 92 million acres of corn and 90 million acres of soybeans this spring. The corn estimate reflects an increase of 1.2 million acres, or 1.3 percent, from last year, while the soybean estimate is up a full 6.9 million acres, or 8.3 percent. USDA said both crops are buoyed by high prices and an expected return to normal planting weather.
“In 2019 and 2020, the area under prevent plant was above average, and simply going back to normal planting weather would increase total planted acres by several million acres,” said Chief Economist Seth Meyer at USDA’s 2021 Agricultural Outlook Forum. The 2020/21 U.S. season average prices for both corn and soybeans are projected at seven-year highs, he said.
At 182 million acres, the combined acreage of both crops would set a new record in the U.S. “We expect grain and oilseed prices to remain at these higher levels, reflecting tight global supplies and strong international demand,” Meyer said. “With a tightening stocks-to-use ratio, increased price volatility is likely as fundamentals are revealed.”
Corn and soybean stocks-to-use ratios are the lowest since 2013/14, Meyer said, and there is no reduction expected in the demand from China or other major importers. Demand from China is expected to push U.S. agricultural exports to a record $157 billion in the 2021 fiscal year, USDA said, up 3.3 percent from the previous forecast.
Combined exports of corn and soybeans reached a record in the fourth quarter, fueled by increased purchases from China as the country’s hog herd recovers from African Swine Fever. The value of U.S. farm exports to China will touch a record $31.5 billion in the federal fiscal year ending Sept. 30, USDA said.
“We see new opportunities around the globe, and we expect better sales almost everywhere we turn,” Jason Hafemeister, a USDA trade official, said on Feb. 18. “Look at China just blowing off the chart.” China will remain the largest U.S. agricultural market this year, he said, followed by Canada and Mexico.
The corn acreage projection was slightly below trade expectations, while the soybean acreage forecast was a bit above. Corn futures traded in Chicago fell as much as 0.8 percent after the forecast, to $5.4650/bushel, while soybeans fell as much as 1 percent, to $13.7125/bushel.
In addition to reductions in prevented planting acres, USDA said the increase in corn and soybean acreage will also come from a smaller cotton crop and lower expected spring wheat and durum acreage in the Northern Plains. Cotton area is projected at 12 million acres this year, slightly lower than last year, Meyer said.
U.S. winter wheat acreage, however, is projected at 32 million acres, a five percent rise over last year and the first increase since the 2013/14 season. Total wheat area is projected to expand 651,000 acres, to 45 million acres, USDA said.