Planting Intentions Drive Down Prices

A dip in commodity prices due to better harvests than was been expected in light of the drought in 2012 can be partly attributed to the miracle of modern crop varieties. This stock carryover, and aggressive planting intentions for corn in the US this season, are putting downward pressure on prices. USDA reports:

• Corn Planted Acreage Up Slightly from 2012
• Soybean Acreage Down Slightly
• All Wheat Acreage Up 1 Percent
• All Cotton Acreage Down 19 Percent

Corn growers intend to plant 97.3 million acres of corn for all purposes in 2013, up slightly from last year and 6 percent higher than in 2011. If realized, this will represent the highest planted acreage in the United States since 1936 when an estimated 102 million acres were planted.

Soybean planted area for 2013 is estimated at 77.1 million acres, down slightly from last year but the fourth highest on record, if realized. Compared with 2012, planted area is down across the Great Plains with the exception of North Dakota. Nebraska and Minnesota are expecting the largest declines compared with last year, while Illinois and North Dakota are expecting the largest increases.

All wheat planted area for 2013 is estimated at 56.4 million acres, up 1 percent from 2012. The 2013 winter wheat planted area, at 42.0 million acres, is 2 percent above last year and up slightly from the previous estimate. Of this total, about 28.9 million acres are Hard Red Winter, 9.67 million acres are Soft Red Winter, and 3.39 million acres are White Winter. Area planted to other spring wheat for 2013 is expected to total 12.7 million acres, up 3 percent from 2012. Of this total, about 12.1 million acres are Hard Red Spring wheat. The intended Durum planted area for 2013 is estimated at 1.75 million acres, down 18 percent from the previous year.

All cotton planted area for 2013 is expected to total 10.0 million acres, 19 percent below last year.