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Soybean acres sacrificed to feed corn demand

Agriculture.com Staff 06/29/2007 @ 6:55am

Farmers took this last winter's signals to plant more corn and did just that.

Friday's USDA-NASS Acreage report reflects the boost in corn acres and where they came from: Farmers planted 19% more corn and 15% fewer soybeans this year than in 2006, the report indicates.

These numbers could translate into big opportunities on the board in the soybean trade, according to Don Roose of U.S. Commodities in West Des Moines, Iowa.

"It's a big surprise that soybean acres are that low," Roose says. "Beans look pretty supportive on it. They could be limit-up today." The analyst calls the CBOT soybean market to open 20 to 50 cents higher -- possibly limiting up at some point -- in Friday's trade.

USDA pegged the total 2007 soybean acreage at 64.1 million acres, down from last year's record high. Some areas, like New York and Pennsylvania, didn't see soybean acres cut this year versus larger decreases recorded in the Midwest.

"Large declines in soybean area occurred across the Corn Belt and Great Plains, with planted acreage also down more than one million acres from last year in Indiana, Minnesota and Nebraska," according to Friday's report. "Many farmers across the country shifted to planting more corn this year at the expense of soybeans."

Turning to the reason soybean acres were cut, USDA estimated total corn planted at 92.9 million acres, three percent higher than the big USDA Prospective Planting report released March 30. This comprises the largest area planted to corn in the U.S. since 1944, when 95.5 million acres were planted.

"We have a big number. The industry sent a signal to farmers during the winter to plant corn, and they did, even though it came at the expense of soybeans," Roose says. "There was a whisper of these numbers on corn. But, now it's more important how we close."

Roose calls corn to open three to five cents lower this morning on the CBOT.

Wheat acres are pegged at 60.5 million acres nationwide, up six percent from last year. Winter wheat acres are 11% higher than in 2006 at 45.1 million acres, largely buoyed by positive planting conditions last fall in many parts of the Plains. Spring wheat acres are pegged at 13.1 million acres, down 12% from last year.

Cotton plantings are estimated at 11.1 million acres, 28% down from last year and the lowest acreage since 1989. Much of this decline could be attributed to more farmers in the southeastern part of the nation planting more corn acres this year.

Farmers took this last winter's signals to plant more corn and did just that.

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