After planting the most corn acres since World War II last year, U.S. farmers are ready to shift their crop rotations again in 2008, putting in more soybeans and spring wheat, according to the latest survey by Farm Futures magazine. Farm Futures is a Farm Progress publication.
According to the new survey, farmers intend to plant 71.8 million acres of soybeans this spring, up from 63.6 million last year. Spring wheat acres will rise to 14.3 million, up 1 million from 2007, while corn sees a drop to 87.7 million from last year's huge 93.6 million acres. Total wheat plantings should hit 63.9 million acres, compared to 60.4 million last year.
"Farmers once again showed they're ready to respond to the market's signals," says Farm Futures Senior Editor Bryce Knorr, who directed the survey. "And the market is telling them to plant more soybeans due to very tight projected Sept. 1 supplies in the U.S."
The magazine's latest survey showed a shift towards more beans compared to a survey it released in December, when corn plantings were put at 88 million and beans came in at 69.5 million acres. Since then the ratio of soybean to corn prices increased from 2.35 to 1 to over 2.50 to 1.
"Questions about acreage are only beginning," says Knorr. "Farmers planted much more corn last year than their March intentions indicated, while soybean acreage dropped sharply. There's also a big question this year about how much new ground - pasture and hay fields - will be converted to row crops." He notes USDA's recent forecast, made at its February outlook conference, showed a much bigger increase in acreage than many believe possible.
And, even the big increase in soybean plantings found in the survey may not be enough, according to Arlan Suderman market analyst for Farm Futures and the Farm Progress family of state and regional magazines.
"Many will look at the increased soybean acreage estimate as an opportunity to rest easy, that the market has done its job," says Suderman. "However, a move to 71.8 million acres is barely enough to maintain soybean stocks at a tight level if the crop achieves trend yields this year. That will keep traders very nervous through the growing season, ready to quickly react to any perceived threat to the crop.
"On the other hand, the drop of nearly 6 million acres of corn is more than that market can allow to happen. A drop of that magnitude would require significant price rationing of demand to prevent the corn pipeline from running dry, even if trend yields are achieved."
Suderman adds that "the market truly has more work to do in the weeks ahead. Look for a long and volatile growing season in the commodity markets with wide price swings becoming the norm until supply and demand are brought into balance."
Farm Futures surveyed 974 growers by e-mail from Feb. 28 to March 14. USDA releases results of its planting intentions survey March 31.