Summary of USDA’s plantings and stocks reports
Farmers plan to plant less land to durum wheat in 2013. The data in the Prospective Plantings report puts durum acreage at 1.75 million acres, down 17.5 percent from a year ago. Acreage in North Dakota is down 240,000 acres year-over-year with declines in every other producing state except South Dakota. Durum wheat acreage is down 40,000 acres in Montana.
The wheat acreage numbers were a little negative for the market, but not nearly as negative as the stocks data also reported Thursday. Wheat stocks as of March 1 were put at 1.23 billion bushels, up 3 percent from a year ago. Almost all analysts surveyed ahead of the report had expected stocks to be below year ago levels. The average of the pre-report survey came in at 1.167 billion bushels. The data suggests that USDA will need to revise up ending stocks for 2013/14 when they update their forecasts in early April. The combination of bearish acreage and bearish stocks caused a big drop in wheat prices on Thursday.
The survey of planting intentions for cotton came in at 10.026 million acres down from 12.315 million acres in 2012. This is about 1 million acres higher than the results of the National Cotton Council’s survey released last month. A big drop in cotton acreage has long been expected with cotton prices falling relative to prices of other crops. The big increase in soft red winter wheat acreage also indicated a cut-back in cotton acreage this year.
Farmers in Texas plan to cut back on cotton acreage by 1 million acres, and acreage is down in every producing state except Georgia, up 10,000 acres, and Florida, 7,000 acres higher. Farmers are set to reduce cotton acreage by more than 50 percent in Arkansas and more than 40 percent in Oklahoma and Mississippi. Cotton prices have improved since the beginning of the year so cotton acreage could end up a little higher than indicated in the Prospective Plantings report.
The cotton acreage intentions were generally in line with expectations. But earlier this week USDA released the annual Cotton Ginnings report and the report showed ginnings of 17.29 million bales. This indicates that USDA’s production estimate for the 2012 crop of 17.01 million bales is too low and some adjustments to production and stocks are likely in the April USDA supply and demand report.
OTHER CROP ACREAGE
The USDA report includes planting intentions for 22 crops ranging from corn with more than 97 million acres to Austrian winter peas at 19,000 acres. The total for all of the crops reported in this report is 323.25 million acres, down almost 1 million from the total for 2012. Cotton acres are down almost 2.3 million acres year-over-year while the biggest increase is 1.38 million acres for sorghum.
With the drought in the Plains states, farmers may opt for a drought tolerant crop like sorghum in areas where it was too dry to plant winter wheat, or in areas where the winter wheat crop just failed. Sorghum acreage in Kansas is up 400,000 acres from the 2012 level and farmers in Texas plan to boost sorghum acreage by 700,000 acres. Sorghum acreage is also up a lot in Nebraska and Colorado, states hard hit by drought.
Farmers say they will plant less land to soybeans and less land to other oilseed crops. Planting intentions for sunflowers are down more than 12 percent to 1.68 million acres, canola acreage is 6 percent lower at 1.65 million and peanut acreage is off 27 percent, falling to 1.19 million acres. Farmers in North Dakota say they will plant more soybeans (up 150,000 acres), but cut canola by 230,000 acres and sunflowers by 224,000. Flaxseed acreage is also forecast to decline this year.