How many acres of soybeans are needed?
Under the assumptions of "reasonable" prices, large South American production, and slower but continued growth in word soybean consumption during the year ahead, consumption of U.S. and imported soybeans should be at least as large as during the current marketing year. With stocks of soybeans at the start of the 2014-15 marketing year at the projected level of 135 million bushels, a 50 million bushel decline in marketing year imports from the record level of this year, and a more comfortable level of year-ending stocks near 185 million bushels, the 2014 U.S. soybean crop would have to total 3.395 billion bushels to accommodate consumption of 3.36 billion bushels. That would be 106 million bushels larger than the 2013 crop and 36 million bushels larger than the record crop of 2009. With a favorable growing season and a U.S. average yield near trend value of 44.2 bushels, a crop of that size would require 76.8 million harvested acres of soybeans. The difference between planted and harvested acreage varies from year to year, depending primarily on the extent of adverse weather. The average difference in the previous 10 years was 970 thousand acres. With larger planted acreage and normal weather, abandonment near one million acres might be expected in 2014. A crop of 3.395 billion bushels, then, would require planted acreage of about 77.8 million.
It could be argued that the projection of marketing year consumption used here is too conservative under the assumption of lower prices. If use is 100 million bushels larger, planted acreage would need to be near 80.1 million under the other assumptions made here. Additionally, the market may need to encourage even more acreage to reflect the risk of an average yield below trend value. Consumption of 3.46 billion bushels and a yield of 43 bushels per acre, for example, would require planted acreage near 81.3 million acres. That is marginally less than reported planting intentions.
Over the past 10 years, planted acreage of soybeans in the U.S. has differed by as much as 3.3 million acres from March intentions and the market still has some time to influence the magnitude of acreage in 2014. Unless conditions change dramatically, however, it appears that planting intentions reported last month are fully adequate to meet consumption needs at more modest price levels than experienced during the past three marketing years.