Fundamentally Speaking

At its annual Ag Outlook Forum, USDA indicated that total planted area of corn, wheat, and soybeans relative to the previous year is up about 3% from the year ago total of 221.8 million acres at 228.0 million.

This is paced by a large 3.8 million acre increase in projected all wheat planted area to 49.5 million, the highest since 2016.

2023 U.S. corn seeded area is pegged at 91.0 million vs. 88.6 million a year ago and soybean planted acreage is seen at 87.5 million, unchanged from the 2022 figure.

If in fact a total of 228 million acres is seeded to all three of these crops, that would be the highest combined acreage of U.S. corn, soybeans and wheat since 230.7 million was planted in 2014.

Of course, USDA did note that as always, normal weather conditions are assumed throughout the season but herein lies the rub.

In prior blog pieces we have noted that big misses in the USDA Ag Outlook Forum estimates for ending stocks of the key crops are often linked to adverse weather that results in final yields, and often final planted area figures, vastly different from what USDA projected at their Ag Outlook sessions such as the one given Thursday morning.

This chart shows the USDA Ag Outlook Forum acreage estimates for corn, soybeans and wheat on the lefthand axis while on the righthand axis is the total of all three as per Ag Outlook Forum and then what the total final figure was all in million bushels.

The USDA has published its Ag Outlook Forum acreage and balance sheet figures since 1998 and last year's 228 combined corn, soybean and wheat planted acreage projection, which is the same as this year, came in 6.2 million above the 221.8 million actually seeded.

2022 U.S. corn planted acreage was 3.4 million below what USDA had projected at the 2022 Ag Outlook Forum due to plantings that were affected by weather-related delays and prevented planting in key-producing regions, while pervasive drought in the Plains pared both wheat planted and harvested acreage.

This 6.2 million drop from the USDA Ag Outlook projection to the final figure is the second largest since 1998, topped only by the 12.7 million acre decline in 2019 when again poor seeding conditions in the spring resulted in final soybean area a whopping 8.9 million below what USDA had projected with corn area off 2.3 million and even final wheat seeded area 1.5 million below what had been projected.

Weather has certainly played havoc with both USDA projections and farmer intentions in recent years for if you include 2020, three of the past four years have seen final combined corn, soybean and wheat planted area off the greatest amount relative to the USDA Ag Outlook Forum projections in the past 25 years.

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