KANSAS CITY — Higher-than-expected planted area for wheat, soybeans and especially corn in the U.S. Department of Agriculture’s annual Acreage report last week caught the attention of traders and pressured prices, at least temporarily.
U.S.D.A. figures for corn, soybeans, all wheat, spring wheat and durum were above the average of pre-report trade expectations. In the case of corn, the difference was significant as the trade expected planted area below year-ago levels while the U.S.D.A. number came in above the 2008 level and was the second largest since 1946 after the 2007 crop. In the case of soybeans, both planted and harvested area would be record large.
Corn planted area was estimated at 87,035,000 acres, up 2,049,000 acres, or 2%, from March intentions and up 1,053,000 acres, or 1%, from 85,982,000 acres in 2008, the U.S.D.A. said. Area for harvest was estimated at 80,107,000 acres, up 2% from 78,640,000 acres in 2008 and 4% above the five-year average of 76.9 million acres.
The U.S.D.A. planting number was about 4% above trade expectations that averaged near 84 million acres. Corn futures prices at the Chicago Board of Trade plunged 7% to 8% for July 2009 through July 2010 contracts with some months down the 30c-a-bu daily limit the day of the report. Nearby July closed at $3.47¾c a bu on June 30, the lowest since early March, down 52% from a year earlier and 54% below the record high of $7.54¾ set June 27, 2008.
"Planting proceeded behind the normal pace, similar to last year, as frequent spring precipitation and cold temperatures slowed early season fieldwork and planting activities," the U.S.D.A. said. "In late May, however, dryer conditions allowed farmers to make rapid progress."
Soybean planted area was estimated at 77,483,000 acres, up 1,459,000 acres, or 2%, from March and up 1,765,000 acres, also 2%, from 75,718,000 acres last year, the U.S.D.A. said. Area for harvest was estimated at 76,547,000 acres, up 2.5% from 74,641,000 acres in 2008 and 7% above the five-year average of 71.7 million acres.
While the soybean planting number was above average expectations, the trade at least had anticipated an increase and price changes were minor compared with corn. Extremely tight old crop soybean supplies kept nearby July futures in positive territory, rising 11¼c to $12.26¼ a bu on the day of the report. June 1 soybean stocks were estimated at 597,044,000 bus, 23% below the five-year average, according to U.S.D.A. Declines in later months ranged from 2@5c a bu, but prices rebounded strongly the next day, gaining at least 25c a bu across the board.
Area seeded to spring wheat other than durum was estimated at 13,772,000 acres, up 468,000 acres, or 3.5%, from March intentions but down 363,000 acres, or 2.5%, from 14,135,000 acres in 2008. Planted area included 13.1 million acres of hard red spring wheat. Area intended for harvest was estimated at 13,205,000 acres, down 2% from 13,487,000 acres in 2008.
Durum seeded area was estimated at 2,555,000 acres, up 110,000 acres, or 4%, from March but down 176,000 acres, or 6%, from 2,731,000 acres in 2008. Durum area for harvest was estimated at 2,453,000 acres, down 5% from 2,584,000 acres in 2008.
Winter wheat planted area was estimated at 43,448,000 acres, up 559,000 acres, or 1%, from 42,889,000 acres indicated in March but down 2,833,000 acres, or 6%, from 46,281,000 acres last year. Planted area included 31.4 million acres of hard red winter, 8.4 million acres of soft red and 3.6 million acres of white. Harvested area was estimated at 34,787,000 acres, down 4,827,000 acres, or 12%, from 39,614,000 acres in 2008. Planted area in Texas was up 5% from 2008 and in Oklahoma it was up 7%, but harvested area, at 3,600,000 acres in Texas, was down 20%, and at 2,450,000 acres in Oklahoma was down 26%, "as both states have experienced below normal precipitation during the growing season," the U.S.D.A. said. Oklahoma wheat also was damaged by a spring freeze.
All wheat area was estimated at 59,775,000 acres, up 1,137,000 acres, or 2%, from March intentions but down 3,372,000 acres, or 5%, from 63,147,000 acres in 2008. Harvest area was estimated at 50,445,000 acres, down 9% from 55,685,000 acres a year ago but only slightly below the five-year average of 50.7 million acres. Wheat prices fell about 10@20c a bu, or 2% to 3%, after the report.
Winter wheat production estimates will be updated by the U.S.D.A. on July 10, along with initial spring wheat and durum estimates, but the first 2009 corn and soybean production estimates will be issued Aug. 12. Until then, traders will closely monitor summer weather across the Midwest, especially during the key pollination period for corn, which greatly determines yield, usually starting in mid-July. Near-term, at least, Midwest weather patterns appeared favorable for crop development.