Soybean futures jumped on the Chicago Board of Trade Thursday after the US Department of Agriculture surprisingly planted its expectations for soybeans, while also forecasting corn acres
Grower will plant 89 million acres with soybeans this year USDA said in a Report Thursday, from 90.1 million last year and a February projection of 90 million acres. The cornfield will total 88 million acres this year, compared to 90.2 million in 2017 and last month's forecast for 90 million acres. The analysts had expected that the soybean area 91 million and the corn area 89.4 million hectares.
Soybeans have become more attractive in recent weeks as prices have improved in arid weather in Argentina. Futures rose to their highest level in nearly two years early this month as crop conditions in the South American country deteriorated due to lack of rainfall in key growing areas.
Nonetheless, respondents indicated that they are not as optimistic about soybeans as traders expect
"At this point, weather will be the biggest determinant" in terms of actual acres planted, said Brian Grossman, an analyst Brokerage Zaner Group in Chicago. "When we warm up, it will be a big corn year, but people are willing to give up soybeans if the weather does not match or because of market variables."
Soybean futures for May delivery rose 30 ¢ to $ 1
Corn futures jumped 13 cents to $ 3.86 per bushel in Chicago.
All-wheat planted acres will rise 3% to 47.3 million this year, the USDA said. Despite the increase, this is still the second-lowest area since records began in 1919. Winter wheat hectares are set at 32.7 million, including 23.2 million hard red varieties, 5.85 million soft reds, and 3.64 million white winters , according to the agency
spring wheat area is projected to 12.6 million acres, 15% higher than 2017. Durum Acres is expected to fall 13% over last year, the USDA said.
Wheat rose 7 ¢ to 4.52 ½ bushels, while Kansas City futures gained 6 ¾ cents to 4.67 ¾ bushels.
The government today released its quarterly grain stocks report.
Corn stocks on March 1 amounted to 8.89 billion bushels, up from 8.62 billion a year earlier. Analysts have reported consumption of 8.7 billion bushels.
Soy stocks at the beginning of the month were reported at 2.11 billion bushels, according to the USDA, an increase of 21% over the previous year. Analysts had expected inventories of 2.03 billion bushel.
Wheat was the only decline, with inventories at 1.49 billion bushels, less than 1.66 billion last year, and analyst expectations for 1.5 billion bushels.
The increase in inventories indicates a lag in demand for US supplies, Grossman said. Zaner correctly capped corn stocks at 8.89 billion bushels and said the amount of soybeans would be 2.06 billion bushels.
"This shows that we missed on demand," he said. "If you look at the sales, you just get the commitment, but inspections are out there, and we're behind inspections." Seeing these larger stock numbers reminds everyone that sales are different than what's actually on the doorstep. "