U.S. farmers are projected to achieve above-average returns for their crops in 2012, with the exception of wheat, according to PotashCorp in its first quarter analysis of 2012.
In the Upper Plains and the Corn Belt, corn is expected to have the highest returns and acreage is to expand at the expense of wheat and soybeans. In the South, peanuts are expected to provide above-average returns, making acreage of that crop likely to increase at the expense of cotton.
Seeded Acreage of Major Crops to Increase
Seeded acreage for the major U.S. crops is forecast to be up 2 percent in 2012. Approximately 7 million acres are projected to exit the Conservation Reserve Program. Most of that land is likely to be planted to wheat, more than making up for the wheat acres planted to corn.
Strong corn prices and higher returns relative to competing crops continue to encourage increased corn acreage around the world, including in the U.S. As South American soybeans are increasingly competitive in export markets and planted soybean acreage there is rising, U.S. soybean acreage is expected to remain relatively flat in 2012. However, recent deterioration to the South American soybean crop has caused prices to firm, which may mean a small increase in U.S. soybean acreage this spring.
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