U.S. farmers to plant more corn, less soy

American farmers are going to plant a lot more corn and less soybeans and wheat, according to the U.S. Department of Agriculture’s Prospective Plantings report.

DTN’s lead analyst Rhett Montgomery said the market anticipated the corn and soybean shifts, but was caught off guard by the wheat number.

The USDA is forecasting 45.4 million acres of all wheat, down two percent from 2024 levels.

Spring wheat planting is pegged at 10 million acres, well below the average trade forecast of 10.5 million.

“That’s why you have Minneapolis futures leading the way higher right now,” he said in a webinar just hours after the report dropped on March 31st.

The biggest decreases were in North Dakota and Montana.

Winter wheat planting is forecast at 33.3 million acres, down from the USDA’s January forecast of 34.1 million.

“They refigured that number and found less winter wheat was planted last fall,” said Montgomery.

Durum area is estimated at 2.02 million acres, down from 2.06 million acres last year.

In total, wheat planting fell by 680,000 acres when the market had been anticipating an increase of 300,000.

Corn was the big winner with the USDA forecasting 95.3 million acres, a 4.7-million-acre bump over last year.

U.S. farmers intend to plant 83.5 million acres of soybeans, a 3.6 million acre drop.

“It’s pretty much just a straight switch from soybeans to corn,” said Montgomery.

Barley acres fell 2.2 percent to 2.32 million, while canola plantings also fell slightly to 2.57 million acres.

“My initial thought was that we were going to see the Dakotas with more canola,” he said.

The U.S. Drought Monitor indicates that 14 percent of U.S. winter wheat acres are in drought areas.

Montgomery believes that is a misleading number because when “abnormally dry” areas are factored in it jumps to 57 percent.

“The 14 percent makes the situation currently seem a little less concerning that I would say it is,” he said.

The situation is most worrisome in Nebraska and South Dakota where only about 20 percent of the crop is rated good-to-excellent.

But there are also concerns in northern Oklahoma, southern Kansas and Michigan.

Montgomery thinks wheat futures may have bottomed out and could be heading higher due to the weather concerns and smaller-than-anticipated plantings.

An estimated 16 percent of the U.S. corn and soybean crops will be planted in regions of the country experiencing drought.

There are concerns in eastern Illinois, central Indiana, northern Nebraska, eastern South Dakota and southwest Minnesota.

“If we get into the corn growing season and that hasn’t reversed, we’re certainly going to most likely have to start penciling in something lower than the USDA’s trend line yields,” said Montgomery.

He will also be keeping a close eye on Brazil’s second corn crop, which will be entering the pollination phase of development in late-April.

“It’s not looking great right now for the potential there. It’s looking really hot and really dry through the middle part of April,” said Montgomery.

Brazil has the lowest corn stocks in 20 years, so any bullish surprise in that country could put upward pressure on the floor of the corn futures price range.

U.S. corn stocks were estimated at 8.15 billion bushels as of March 31, the second highest level in five years.

The good news is that corn demand has been “very impressive” due in a large part to what appears to be a record second quarter export program.

Demand from the ethanol sector has also been strong, but feed use was a bit disappointing due to a shrinking U.S. hog herd.

Soybean stocks were pegged at 1.91 billion bu., which was in line with trade expectations.

Wheat stocks were quite a bit higher than the trade was forecasting, coming in at 1.237 billion bu. versus last year’s 1.09 billion.

Tags: winter wheat, soybeans, wheat, durum, spring wheat, corn, barley, planting, canola