Farmers indicate they will plant less corn and soybeans than anticipated in 2021. Micheal Clements shares what this means for supply and demand.
Clements: The Department of Agriculture’s Prospective Planting report revealed farmers intend to plant less corn and soybeans this year than expected. American Farm Bureau Federation Economist Shelby Myers says farmers plan to plant 91.1 million acres of corn and 87.6 million acres of soybeans.
Myers: And combined, that acreage would be an estimated 178.7 million acres, which would be the second-highest on record behind 2017 when we did 180 million acres of corn and soybeans. And from what we can tell, that’s really the big story of what farmers intend to do this year and those two big commodities are the hot story at the moment.
Clements: Those figures are lower than previous estimates released by USDA earlier this year.
Myers: They estimated that farmers would plant 92 million acres of corn and 90 million acres of soybeans. And then even leading up to the report, we’ve gotten high prices over the last month, and the estimates for corn were just about 93.2 million acres and soybeans were closer to 89.9 million acres, and we ended up lower than both of those estimates.
Clements: Myers says that outside of an increase in planted acres, to meet the increased demand for corn and soybeans on the horizon, record-breaking yields or supply rationing will need to occur.
Myers: With tightened supplies and rising commodity prices for both corn and soybeans, it really was expected that farmers would be planting every acre possible, and these estimates don’t really reflect that. I guess the good news for farmers is the tightened supply and increased demand will really help hold commodity prices at these current high levels and potentially drive them even higher.
Clements: Read more on the Market Intel page at fb.org. Micheal Clements, Washington.