The table above shows historical US planting intentions (not final acres), and amid rising prices of minor feedgrains, cottons, soybeans and even relatively solid spring wheat prices a modest boost in total area is expected. ARC pegs total major cropped area at 239.6 Mil Acres, up 1.8 Mil from last year and the highest since 2014. Recall CRP land is capped at 24 Mil, and otherwise markets are signaling the need for higher oat, barley and cotton area. The US acreage pie will be growing slightly, but it remains that corn will be the least favored crop outside of the primary Ag Belt. On a percentage basis, cotton, barley and oat acreage will expand most. Economics simply don’t favor corn, and so corn seedings are pegged at the lowest level since 2010.
In recent years, relative returns in late winter have been the best indicator of corn/soybean’s share respective share of the acreage pie. As of this week, soybeans offer more incentive. Even in 2016, when prices of both corn and soybeans were low, that corn’s returns were better on the margin predicted what at the time was a rather sizable boost in corn acreage. Corn intentions in 2016 totaled 93.6 Mil, vs. 89.2 in 2015 – the point being ARC is confident that corn acreage intentions will be down on the year, while bean acreage will be a record large 90.5 Mil. Acreage data doesn’t typically drive price on report day – recall Feb 28 stocks are released simultaneously – but this does give us pause with respect to chasing breaks in corn futures, particularly as seeding delays are becoming likely in the Delta & Southeast.