On Thursday the USDA will release its perspective plantings report, as well as the quarterly stocks for Corn, Wheat, and Soybeans. This report typically carries some weight in the market place, but this year could be more impactful, as it could shift the attention to our situation in the United States. For the lion’s share of 2022 the domestic crop outlook has been neglected with the majority of attention being on the developing situation between Russia and Ukraine.
Quarterly Stocks: AVG EST compared with March 2021
- Corn + 18 Million Bu
- Soybeans + 34 Million Bu
- Wheat -26 Million Bu
These small expected increases should not have much impact on the market as they are not insurmountable and there are so many storylines yet to play out locally.
Acreage: AVG EST Compared with 2021 Final
- Corn -1.356 Million Acres
- Soybeans +1.532 Million Acres
- Wheat +1.068 Million Acres
The analysts are calling for a small drop in Corn Acres and slight upticks in both Soybean and Wheat Acres. Its no secret the pull back in corn acres is due in part to the skyrocketing Fertilizer Price. For example, the average Anhydrous price last week was $1,523, compared to a 5 year average of $500.00. The ratio of DEC Corn and NOV SB is usually at 2.5. I still contend that Soybeans need to do more work to justify this uptick in acres. Right now (DEC Corn at 648 and NOV SB at 1444) is 2.23. Suggesting Soybeans need to be higher, corn needs to be lower, or some combination of the two.
The final thing that could move this acreage number is if the FSA Allows for CRP ground to be pulled out and farmed this year. Personally, I feel that this isnt going to happen and I do not think it would provide much assistance in the potential problem we are staring at.
The fact still remains that the pressure is going to be on the American Farmer to produce at least an average crop this year in order to feed the world. South American crops were disappointing and the Russia – Ukraine situation has left that area of the world in disarray. Any hiccups in the United States could prove to make things very tight both domestically and across the world in my opinion.
Looking to Trade or Hedge Commodities Please reach out and let’s chat…
David Ericson
712.435.7402
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