Fundamentally Speaking

Similar to what we did with corn, this graphic shows the percent of the U.S. soybean crop planted by May 19 going back to 1980 on the left hand axis.

For each year, we also show the percent that the final yield deviated from the 1980-2018 trend along with the percent that final plantings deviated from the farmer intention figures given at the end of March.

The fact that corn plantings are at their slowest point ever as of May 19 at 49% implies that 2019 soybean seedings may exceed the 84.6 million acres that were reported on the end of March USDA prospective plantings report as this is a crop that can be put into the ground later in the year.

News that the Trump administration is considering payments of $2 per bushel for soybeans but only 4 cents per bushel for corn as part of a package of up to $20 billion to offset farmers' losses from the trade war with China, (basing payments on the acreage farmers plant this year and their historic yield of crops per acre) could also keep farmers planting soybeans even though seedings of that crop this year are the slowest in 23 years.

Earlier this week USDA noted that as of May 19, 2019, only 19% of the soybean crop was in the ground and that is the lowest since 15% was seeded as of 5/19/96.

Other slow years include 1995 at 13%, 1993 at 16%, 1990 at 16%, 1984 at 15% and 1983 at 12%.

Interestingly, as opposed to corn where all the really late planted years such as 1983, 1993, 1995 and 2013 featured both acreage declines from the March intentions to the final production report and below trend yields, such is not the case for soybeans.

1983 did feature yields 11.7% below trend and an acreage decline of 7.8% while the following year yields were again down 7.0% but acreage increased by 3.8%.

Other years such as 1990 and 1996 saw yields above trend while years such as 1995 and 1996 saw final plantings above the March intentions and unchanged in 1993.

I guess we can say that since shorter season variety soybeans can be seeded even into early July, late plantings as of May 19 are not as much a hindrance for this crop as corn as the correlation between plantings as of May 19 and acreage changes is 18% vs. 62% for corn.

The correlation between that May 19 planting date and yields is an even lower 6.3%.

(KM)