In a normal year, the USDA’s June planting report is a fairly accurate reflection of what’s growing in the agricultural fields of the nation.
This year, however, wet weather has kept farmers out of the field in the corn belt well past the usual June survey date. That’s either going to mean prevented planting or more soybean acres for a large number of fields in those states, particularly in the Illinois region.
Exactly which choice farmers made, however, is hard to say, since the survey work was completed in mid-June, when corn prices were rallying and many farmers were still thinking they could plant corn.
The unusual situation has put big question marks over the true value for corn — and ultimately soybeans and wheat — and prompted USDA to announce that it will resurvey 14 states in July, to update its planted acreage report in August.
Montana and North Dakota are not in the corn belt, but the latter will be among states that are resurveyed, to solidify its soybean numbers.
While what happens in Illinois, Indiana, and Ohio may seem far away from home, the numbers will have a ripple effect on prices set for commodities in cash markets here, where farmers will ultimately sell their grain.
“It matters especially for the future’s market, because it’s really concerned about putting a value on U.S. corn and soybeans,” explained NDSU extension economist Dr. Frayne Olson. “The futures market pays a lot of attention to how many acres have been planted and where they have been planted, as well as the yield potential for corn and soybeans. So even though it isn’t in our backyard, you still have to pay attention to what’s happening, because it will affect the futures market and prices.”
The planted acres report for Montana and North Dakota are fairly accurate, Olson believes, though there may be some adjustments here and there.
“We did not have a lot of prevent planted wheat,” he said. “The core spring wheat regions in our state were either normal or on the dry side.”
There was an L-shape area on the southeastern edge of North Dakota with some prevented acres, but nothing like what’s happened in the corn belt states, which includes Iowa, Illinois, Indiana, Ohio, parts of southern Minnesota, eastern Kansas, northern Missouri, and parts of Wisconsin and Michigan.
One notable highlight in the USDA’s acreage report is an adjustment to durum acres, which went down a little more than expected, as they did in Canada.
There’s been a lot of carryover for durum, which has been depressing prices for that commodity. Olson believes the larger than expected reduction to durum acres in the planted acres report could help add some base or support to the durum market.
Most of the other numbers in North Dakota’s planted acreage report were close to what was expected, leaving soybean acres the only real question mark.
In March, for the prospective planting survey, farmers said they thought they would plant 6.5 million acres of soybean. In June, that figure had dropped to 5.9 million.
If some of the state’s corn acres shift to soybeans, that number will rise again. Or, if they decided to consider their acres prevented planting, it will drop even more.
Meanwhile, farmers are nearing decision time for soybeans still in the bin — which are being stored in considerable numbers, not just in North Dakota, but nationwide.
“My concern as we get into the summer months, is making sure the bins of soybeans stay in good condition,” Olson said. “Storing them is much different than wheat and corn, because it is an oilseed. You have to be very careful that they stay in good condition.”
Soybeans need to be at 11 percent moisture or less to prevent deterioration.
“The big unknown, the big wildcard is what happens with the China trade agreement,” Olson said. “We are finally negotiating again, which is a good thing.”
However, how it will all come out is hard to read.
“The statements that came out of the White House and Beijing are very different,” Olson said. “We are getting some conflicting messages on what was agreed to and how fast it might move.”