The US Department of Agriculture’s (USDA) March 28 Prospective Plantings report provided a few surprises and insight into potential 2024 acreage and crop sizes. This year’s report comes with mostly favourable weather across key growing areas and commodity prices below those of the past couple of years in many cases.
The USDA said farmers intend to plant 90 million acres of corn in 2024, down 5% from 2023; 86.5 million acres of soybeans, up 3%; and 47.5 million acres of wheat, down 4%. The wheat area includes 34.1 million acres of winter wheat (down 1% from the January estimate and down 7% from 2023), 2.03 million acres of durum (up 22% from last year), and 11.3 million acres of spring wheat other than durum (up 1% from a year ago). Of course, winter wheat is already up and growing.
USDA said. Planting intentions were higher than 2023 for rice, durum, other spring wheat, canola (record high), peanuts, soybeans, cotton and pulses (dry beans, peas and lentils). Fewer acres were expected to be planted in 2024 to barley, corn, oats, grain sorghum, winter wheat, flaxseed, sunflower and sugar beets.
Analysts noted that sharply lower prices from last year for some commodities may have reduced planting intentions (some of which still may change). In its March 8 World Agricultural Supply and Demand Estimates report, the USDA forecasted average prices paid to farmers in 2023-24, down from 2022-23 for all wheat, corn, sorghum, oats, rice, soybeans and cotton, with only barley unchanged.
Corn, soybean, and wheat futures were all at or near three-year lows at some point in recent months due to ample domestic and global supplies.
Compared with pre-report trade expectations compiled by Reuters, the USDA corn number was below the average and near the bottom of the full range of analysts’ projections. Soybeans were close to the average, and all wheat came in above the average. The lower-than-expected winter wheat area was offset by durum and other spring wheat, which were both above the average and the full range of expectations.
Following the report’s release, analysts generally said they were most surprised by the corn forecast and called the soybean number neutral. One noted that the first acres to be pulled from corn will be lower-yielding fields, so the final production number may not be lowered by the same percentage. Yield, in large part, is determined by weather during the growing season, and weather plays a key role.
Weather and soil moisture conditions are much better heading into the spring planting season than a year ago. The largest improvement is for the already planted winter wheat, with 17% growing in areas of drought versus 48% a year ago, according to the USDA’s assessment of the March 26 US Drought Monitor. For other crops (most of which aren’t planted yet), 23% of corn production was in an area of drought (30% a year ago), 21% of soybeans (22%), 1% of peanuts (21%), 1% of rice (4%), 7% of sunflowers (37%), 14% of sorghum (90%), 23% of durum (35%), 25% of spring wheat (35%) and 21% of barley (18%).
If there is an area of concern for drought, it would be the Midwest, west of the Mississippi River (northern Missouri, Minnesota and especially Iowa, the nation’s top corn and second largest soybean-producing state). In addition to Minnesota, several northern-tier states had large areas of drought, including northern Idaho, Montana, North Dakota and Wisconsin.
However, weather forecasts for April called for above-average rainfall across most major US crop areas and above-average temperatures. While the moisture may slow planting progress, the warmer weather will raise soil moisture and soil temperatures and boost early-season conditions.
The USDA, in its April 1 Crop Progress report, said 2% of corn in the 18 major states was planted as of March 31, with Illinois at 1% planted, the only Corn Belt state with seed in the ground. Spring wheat was 1% planted. Winter wheat was rated 56% good-to-excellent versus 28% a year ago.