News

Biofuel rules, China trade could shift U.S. corn and soybean acres

The chief commodities economist with Stone X Group says the biggest factors shaping farmer planting decisions might not show up in USDA’s planting intentions data.

Arlan Suderman says the Trump administration’s final biofuel blending requirements and possible trade deal with China are expected after the USDA wraps up the planting intention surveys.

“If China does buy another eight million metric tons, the market will probably want to buy more soybean acres than four million. If not, they’ll probably not want to buy as many.”

He also says recent changes to crop insurance also favor corn…”as long as a farmer is able to come up with operating revenue to buy the input costs. That’s key there. If they can do that, it favors a smaller switch from corn to soybeans.”

Suderman says the weather always plays a role.

Ahead of its March farmer survey, the USDA is projecting U.S. corn plantings to decline to 94 million acres, a decline of 4.8 million from last year, and soybean acreage to increase to 85 million acres, an increase of more than three million acres from last year.

The USDA’s Prospective Plantings report is scheduled to be released on March 31. This is the first data-driven snapshot of what U.S. farmers intend to plant, which sets the tone for markets and planning.