Prospective Plantings Recap

USDA released their annual Prospective Plantings report Friday morning (Mar 30).  The report reveled that corn is the big gainer in terms of acres planted this year versus last year.  Corn acres across the U.S. are expected to jump by almost four million to 95.864.  Although not the largest gainer in terms of total acres, peanuts are projected to increase by 24.7%.  This accounts for an increase to 1.422 million acres from 1.141 in 2011, or up 281,000.  Cotton and soybeans are expected to see the largest declines in acreage across the U.S.  Cotton acres are projected to be down 1.577 million acres versus last year at 13.155 million (total cotton acres, Upland acres are projected at 12.885 million).  Soybean acres are expected to drop by 1.074 million to 73.902.  Two other crops that will see an increase in total acres are hay and wheat, forecasted at 57.348 and 55.908 million, respectively and up 3.1% and 2.8% from 2011.  Grain Sorghum is also forecasted higher at 5.95 million acres, up 469,000 from last year.  Rice and Sweet Potato acres are expected to fall compared to 2011 by 128,000 and 800, respectively, which would put 2012 plantings for these two crops at 2.561 million for rice and 133,400 for sweet potatoes.

With respect to Mississippi projected plantings, acreage gains and losses follow the national scene.  Corn, grain sorghum, peanut, wheat and hay acres are forecast higher; while cotton, rice, soybean, and sweet potato acres are forecast to decline.  The buggest jump for Mississippi compared to 2011 is wheat acres.  Wheat plantings in the fall 0f 2011 were 120,000 above the year prior at 480,000 total.  Corn acres are projected to increase by 90,000 which would put total acres at 900,000.  As was the case across the U.S. peanut acres in the state are expected to have the largest percentage increase (up 233%) but account for 35,000 total increased acres.  Peanut plantings are expected to be at 50,000 acres compared to 15,000 last year.

Soybean acres are forecast to fall by the largest amount compared to the other crops reported.  Soybean acres are expected tp drop by 70,000 acres to 1.75 million.  The second largest loser in Mississippi is cotton acres, which are forecast to fall by 50,000 acres to 580,000.  Other crops losing ground this year are rice (down 25,000 to 135,000) and sweet potatoes (down 1,000 to 23,000).

The higher corn and lower soybean acres in the U.S. are a bit of a surprise.  Pre-report estimates pegged corn and soybean planted acres at 94.7 and 75.4 million (versus 95.9 and 73.9 reported).  Mississippi’s higher corn acreage did not surprise me but I was caught off guard by the lower soybean plantings projection.  The relationship between soybean and corn price had heavily favored soybeans during February and March, the time in which the survey that underlies the reported acreage numbers is done.  On-the-other-hand, warmer temperatures have favored early corn plantings, which typically translates into better yields so this factor could have swung the pendulum back towards corn.

Cotton prices have deteriorated from the hay days of this time last year.  As a result, it was no big surprise that acres are projected to be down in 2012.  The National Cotton Council had forecast total U.S. acres at 13.628 million (13.341 Upland), and the reported amount of 13.155 (12.855 Upland) was a shade lower but not too far off.  The Cotton Council’s survey from Mississippi producers had the state pegged at 589,000 acres, which was slightly above the reported value of 580,000.

U.S. wheat acres were lower than pre-report estimates of 57.6 million (reported value was 55.9 million, 41.7 of which was winter wheat).  Corn and wheat seemed to be on the same declining trajectory so that likely had an impact on Spring wheat plantings.  The drought stricken Southwest, which has finally begun to receive some rains (too little, too late?) and grows quite a bit of winter wheat, also factored into this number.

Lower rice prices since late-September/early-October of last year did not bode well for an increase in acres and the lower number was not a shock.  Peanut prices started to soar in the second half of 2011 and as a result the jump in acres in not surprising.  Georgia and Alabama are expected to add more total acres (+95,000 and +40,000, respectively) but Mississippi would have the largest year-over-year percentage increase of any reported state (+233%, up 35,000 acres).  The acreage increase would move Mississippi from the 10th largest (of 11 reported) state to the 7th largest with respect to peanut acres.