USDA: Big Soybean Stocks to Limit Bean Acres to 85 Million

Posted on 02/21/2019 11:02 AM

U.S. farmers will likely plant 92.0 million acres to corn this year, up 3.3% from 2018’s 89.1 million acres, USDA projected at its Ag Outlook Forum. This would mark the biggest planted acreage figure in three years.

Soybean acres will likely fall to 85.0 million acres, according to USDA. That’s down 4.7% from the 2018 season when farmers planted 89.2 million acres to the oilseed and was a bit lighter than the 86.1 million acres analysts surveyed by Reuters anticipated.

Robert Johansson, USDA’s chief economist, explains that record-setting domestic and global bean supplies will likely discourage plantings, noting that while beans sales “to the EU, Egypt, Argentina and many others are up this year,” they “have not been enough to make up for the lost export to China.”

But Johansson also noted that the projected drop in soybean acres is “tempered by current forward pricing opportunities.” As of Wednesday’s close, the November soybean futures to December corn futures ratio is around 2.4—the lowest ratio for this point in the season in three years, but still higher than it was in 2015 and 2016.

USDA projected total U.S. wheat plantings for 2019 at 47.0 million acres, down 1.7% from the previous season’s 47.8 million acres and in line with trade expectations. Johansson noted that wet weather during the fall limited winter wheat seeding, though he did add that spring wheat plantings could expand if prices warrant it.

USDA projects farmers will plant 14.3 million acres to cotton this season, up 1.4% from 2018’s 14.1 million acres and a bit under the 14.5 million acres the National Cotton Council’s annual survey indicated would be seeded.

But with the Midwest still blanketed by snow and trade talks with China underway, a lot could change in the months leading up to planting season. These are simply USDA’s “best guesses” based on current conditions.

 

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