USDA report on planting shocks analysts, markets | TheFencePost.com

USDA report on planting shocks analysts, markets

-The Hagstrom Report

The Agriculture Department said Monday that producers were not able to plant crops on more than 19.4 million acres in 2019, the most prevented plant acres reported since USDA’s Farm Service Agency began releasing the report in 2007, and 17.49 million acres more than reported at this time last year.

At the same time, USDA raised corn acreage, yield and production well above pre-report expectations, “which sent corn to limit losses,” DTN/The Progressive Farmer noted in an analysis. One of the reasons that prices went down is that USDA lowered its estimate of corn and soybean exports by 100 million bushels apiece for the marketing year that begins on Sept. 1, noted Chuck Abbott of the Food & Environment Reporting Network.

The lower soy forecast reflects “reduced global import demand, mainly for China,” said the USDA. U.S. corn exports face increasing competition from Brazil and Argentina, beneficiaries of the trade war, Abbott noted.

Analysts said farmers may have been motivated by a Trump administration decision to base trade-war payments on planted acreage on a farm, Abbott wrote. Ten percent of producers polled by Purdue University in July said their corn plantings were influenced by the rule, he noted.

Of those prevented plant acres, more than 73 percent were in 12 Midwestern states, where heavy rainfall and flooding this year has kept many producers from planting mostly corn, soybeans and wheat, USDA said.

“Agricultural producers across the country are facing significant challenges and tough decisions on their farms and ranches,” USDA Undersecretary for Farm Production and Conservation Bill Northey said. “We know these are challenging times for farmers, and we have worked to improve flexibility of our programs to assist producers prevented from planting.”

USDA supported planting of cover crops on fields where farmers were not able to plant because of their benefits in preventing soil erosion, protecting water quality and boosting soil health, Northey noted. The report showed where producers planted 2.71 million acres of cover crops so far in 2019, compared with 2.14 million acres at this time in 2018 and 1.88 million at this time in 2017.

“When you plant a crop on June 10, instead of April 10, you started behind the eight ball,” Farm Journal economist Chip Flory said. “And we did that on about 40% of the corn acres out there. It’s shocking the farmer survey generated the results that it did. I thought the late planning dates would have probably skewed the numbers down.”