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Monday, March 14, 2016

Grain Stocks & Prospective Plantings Reports Previews

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Grain Stocks & Prospective Plantings Reports Previews
Darrel Good, Agricultural Economist - University of Illinois

USDA will officially kick off the new year for the spring planted crops when it releases two reports on the last day of the month. Todd Gleason has this preview from the University of Illinois.

The Grain Stocks and Prospective Plantings reports…
2:21 radio
2:30 radio self contained

The Grain Stocks and Prospective Plantings reports will be released March 31st. Darrel Good says both will help set the tone of the trade for corn and soybeans going forward.

Good :33 …the potential size of the upcoming crops.

Quote Summary - The Stocks report will be modestly important as it always is for corn. It will give us a reading on how fast we are feeding last year’s crop, but the real information will be in the Prospective Plantings report. It can be a mixed bag. This is because we all know actual plantings deviate from intentions. Certainly, though, when we see the March survey and what farmers are planning this year, it will provide a lot of information about the potential size of the upcoming crops.

The Prospective Plantings report is set up to be very interesting. More than a few acres around the United States need a new home on the spreadsheets. For instance, last fall farmers seeded about 2.8 million fewer acres of winter wheat than they did the previous year. When you couple those acres with what most expect to be fewer Prevent Plant acres, it creates an interesting combination says the University of Illinois agricultural economist.

Good :46 …important in the March plantings report.

Quote Summary - On the surface this says, “We’ll have more acres available than we had last year”. What the intentions report will give us a hint at is whether producers are thinking about leaving some acreage idle in 2016 because of the generally low commodity prices. For example, will the winter wheat acres that didn’t get planted go to fallow, or to annual pasture, or will they go to sorghum or an oilseed. Will we see some of the so called fringe areas leave some acreage idled as the numbers would suggest we’ve seen in the past when prices are low. So, that big picture question will be most important in the March plantings report.

Again, the reports will be released March 31st. Last year there were 6.7 million acres of Prevent Plant. That’s on the high side because of the heavy 2015 rainfall. Darrel Good expects this year to be something closer to 3 million acres. And, when you round up to 3 million fewer acres of winter wheat, you get about 6 million float acres that need a home this year either idled, or planted.