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April 3, 2013

2013 U.S. Prospective Planting Report

With the release of the Prospective Plantings Report last week, a baseline has now been established from which we will add or subtract acreage as we move through the spring planting season. The report indicated that the 2013 corn acreage would be 97.3 million acres, which was within market expectations, but the 2013 soybean acreage at 77.1 million acres, was generally a million acres or more below market expectations.

Below are tables listing the acreage change from 2012 to 2013 for most of the major producing states. If a state does not appear on the list, it is because no change in acreage was indicated in the report.

States Increasing Corn Acreage in 2013States Decreasing Corn Acreage in 2013
State Acre Increase State Acre Decrease
North Dakota500,000Illinois600,000
Arkansas290,000South Dakota250,000
Texas250,000Missouri200,000
Minnesota250,000Colorado170,000
Mississippi230,000Indiana150,000
Georgia150,000Kansas100,000
Louisiana60,000Nebraska100,000
Ohio50,000Tennessee70,000
North Carolina30,000Kentucky50,000
Pennsylvania20,000Michigan50,000
Alabama20,000
South Carolina15,000

If you look at the state-by-state changes, there are several distinct patterns.

  • There will be an increase of nearly 800,000 corn acres in the Delta and the Southeast including: Louisiana, Arkansas, Mississippi, Alabama, Georgia, South Carolina, and North Carolina.
  • There will be a decrease of 1,400,00 corn acres in key Corn Belt states such as Illinois, Indiana, South Dakota, Missouri, Kansas, and Nebraska.
  • The two biggest changes are a decrease of 600,000 corn acres in Illinois and an increase of 500,000 corn acres in North Dakota.

These acreage changes could have an impact on the nationwide corn yield this summer. In broad terms, we seem to be reducing higher yielding acres in the heart of the Corn Belt and increasing lower yielding acres in the south and northwestern Corn Belt. If everything else was normal this growing season such as planting dates, soil moisture, summer weather, etc., this switch in acreage alone could lower the nationwide corn yield by a couple of bushels.

With the big increase in corn acres in North Dakota, the state now ranks ninth in corn acreage just behind Wisconsin and ahead of Ohio. North Dakota needs to be watched closely this spring because of the heavy snowpack and the potential for spring flooding along the Red River in eastern North Dakota and western Minnesota. Severe flooding could jeopardize the corn planting and result in less corn acres and more soybean acres being planted in the region.

States Increasing Soybean Acreage in 2013States Decreasing Soybean Acreage in 2013
State Acre Increase State Acre Decrease
Illinois350,000Nebraska350,000
North Dakota150,000Minnesota250,000
Tennessee110,000South Dakota150,000
Michigan100,000Missouri100,000
Georgia60,000Kansas100,000
Arkansas50,000Indiana50,000
Iowa50,000Kentucky20,000
Ohio50,000Louisiana20,000
Mississippi20,000
North Carolina10,000
South Carolina10,000
Wisconsin10,000

For soybeans, the biggest trend appears to be a decrease of 850,000 soybean acres in the western states of Nebraska, Minnesota, South Dakota, and Kansas. In the commentary at the back of the report they stated "Compared to last year, planted acreage intensions are down across all of the Great Plains, with the exception of North Dakota, as drought conditions have persisted in many of these areas." They seem to be saying that farmers are planting fewer soybeans due to the drought, but soybeans are more tolerant to drought than corn, which was evident last summer when many farmers had extremely poor corn yields, but only moderately disappointing soybean yields.

This raises the question as to what will take the place of soybeans in these western states. It's not going to be corn, could it be grain sorghum? Grain sorghum acreage is increasing, but the biggest increase in grain sorghum acreage is expected in Texas (+700,000 acres), Kansas (+400,000 acres), and Colorado (+85,000 acres) and grain sorghum generally does not compete with soybeans in these areas. So I guess I am somewhat at a loss to explain why the fear of drought would reduce soybean acres and I don't know what crop would replace the soybeans.

Another trend in the soybean estimate continues to be the ever increasing soybean acreage in North Dakota. According to the report, North Dakota will now rank number six in soybean acreage at 4,900,000 acres, behind Indiana (5,100,000 acres) and ahead of Nebraska (4,700,000 acres). Soybean production continues to move northwestward not only into North Dakota, but also into the prairie provinces of Canada as well.

The real shocker in the reports last Thursday was the corn stocks coming in about 400 million bushels above trade expectations. The larger than expected number was primarily the result in a very low feed use for the quarter. Either the feed use numbers will have to be revised upwards in future reports or the 2012 U.S. corn crop was much bigger than what the government had estimated. If there are any revisions, they will probably occur in the September year-end reports.

Now that the calendar has turned to April, farmers are going to be prepped and ready to start planting corn as soon as the weather permits. The temperatures are going to be cold this week and as a result, there will probably not be any corn planted in the Midwest outside of maybe the far southern locations. The temperatures look warmer for the second week of April, and if it doesn't get too wet, a few acres of corn may be planted during the second week.