Farmers throughout the Corn Belt are severely behind the five-year average when it comes to planting corn.
In fact, Illinois corn farmers are 56 percentage points behind, at only 10% planted. Farmers in Indiana are 30 percentage points behind and farmers in South Dakota haven’t started. With only 23% of the country’s corn crop planted, farmers are likely to start taking a hard look at soybeans and their prevent plant premiums, says John Newton, chief economist for the Farm Bureau Federation.
“I was just in the Midwest last week and there's a whole lot of ground still underwater,” he says. “The rivers are extremely wide and so planting is already delayed. We're anticipating more rainfall this week that can further delay corn planting and lead to additional soybean acres.”
According to Newton, the challenge on planting soybeans, is finding a market for them as trade tensions mount.
“We've still got old crop beans to sell,” he says. “If we plant additional soybean acres and the market demand for them is limited we can be looking at soybean prices that are far below the prices that we have now in that $8.50 range.”
Farmers are beginning to experience soybean planting delays as well, with just 6% of the nation’s crop planted compared to the five-year average of 13%. As time marches on many farmers will start to evaluate their preventive plant options.
“It's up to each farmer to evaluate that crop insurance coverage with respect to their opportunities,” he says. “I think back to 1993, that was the last time we had a really major flood across the Corn Belt, at that point time the waters that we saw were really in that July month.”
Without an accurate picture of what the weather could be like for the remainder of the growing season, opportunity could lie ahead.
“If you can get a crop in the ground, there could be an opportunity to market at higher prices, if these adverse weather events continue through the growing season,” he says. “A lot of grain folks are just watching the pace of planting and then ultimately becomes a consumption story after we know what the weather's been.”