USDA reports show increased acreage, declining grain stocks
By Jennifer Whitlock
The United States Department of Agriculture (USDA) yesterday released key reports, including the annual acreage report and the quarterly grain inventory report, which pushed up corn and soybean futures prices.
Before the reports were released, analysts had expected inventories to drop and area estimates to rise, but official estimates were below expectations, creating bullish conditions in the futures market.
Corn planted for all purposes is estimated at 92.7 million acres, up just 2% or 1.87 million acres from 2020. Soybean area increased 5% from the previous year. last year to reach 87.6 million acres. Wheat acres saw modest gains of 5% to 46.7 million acres.
Although acres of corn and soybeans totaled a record 180.3 million acres, set in 2017, drought in many major corn and soybean-producing states could limit crop yields.
And supplies are already tight. Inventories were down sharply, with corn inventories in all positions totaling 4.11 billion bushels, down 18% year-on-year and the lowest in eight years. Likewise, all wheat was down 18% from 2020 levels. Old crop whole wheat stocks stood at 844 million bushels and old crop durum stocks at 27 million. , 5 million bushels, down 34% from a year ago. Soybeans were even lower at 767 million bushels, just 44% of last year’s stocks.
On the news, CME Group’s September and December corn futures jumped 40 cents, hitting the daily market limit. Soybeans climbed 85 cents, with July and August futures closing at 90.25 and 90 cents higher, respectively, and new crop November futures ending at 86.5 cents higher. September wheat futures were 33.25 cents higher at the close.
What does this mean for Texas farmers?
With 1.7 million acres expected to be harvested for corn, 134,000 for soybeans and 2.25 million for winter wheat, USDA data shows, this could be a good year.
After some concerns related to heavy rains in late spring, the maize harvest is progressing well. The latest USDA Crop Progress and Condition report shows 76% of Texas corn is in excellent or good condition, and 20% is rated fair. Maize jogging reached 67% overall, up 10% from the five-year average, with maize from the lower Rio Grande valley approaching harvest stage.
However, some wheat growers have encountered difficulties with the harvest due to excessive rains and damage from hail or wind. The USDA showed that winter wheat harvested for grain is only 75% complete, down 19% from the previous year and 7% below the five-year average.
Soybeans in Texas are not doing as well, with only 52% of the crop in excellent or good condition and 42% in fair condition. It remains to be seen how soybeans will fare, but the USDA has noted that Blacklands soybeans have been doing better with more sun in recent days.
Only time will tell how cultures progress, but for now analysts say market volatility is the name of the game.