USDA Acreage Report on June 30th – Crop Trends in the U.S. and Kansas (Kansas State University Analysis)

On June 30, 2016 the USDA National Agricultural Statistics Service (NASS) released its 2016 Acreage report and its June 1st Quarterly Stocks report.  Following are the key findings and market implications in the June 1st Acreage report by major and a selection of other crops in the United States.  Analysis of the June 30th Grain Stocks report will also be published on the KSU www.AgManager.info website.

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A. Corn Acreage in the U.S. & Kansas

The USDA projected 2016 U.S. corn planted acreage to be 94.148 million acres (ma) – up 1.389 ma (+1.5%) from pre-report trade expectations.  Planted acreage of 94.148 ma in 2016 would be the largest amount since 2013, being up from 87.999 ma planted in 2015, 90.597 ma in 2014, but less than 95.365 ma in 2013, and the record high 97.291 ma in 2012.  See Table 1 and Figure 1 below.

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The USDA also projected 2016 U.S. corn harvested acreage to be 86.550 ma – up from 80.749 ma in 2015, and from 83.136 ma in 2014 – but less than the record high 87.451 ma in 2013, and 87.365 ma in the drought year of 2012.  Percent harvested-to-planted acres is projected to be 91.9% in 2016 in comparison to 91.8% in 2015 and 2014, 91.7% in 2013, and 89.8% in the drought year of 2012.

Kansas 2016 corn planted acreage is projected by the USDA to be 4.800 ma – up 15.7% from 4.150 ma in 2016 (Table 2).  Projected 2016 Kansas corn planted acreage of 4.800 ma was unchanged from the March 30th USDA Prospective Plantings report, but up 11.6% to 18.5% from Kansas corn plantings in the range of 4.150-4.300 ma over the 2013-2015 period.  Similarly, Kansas 2016 corn harvested acreage is projected to be 4.550 ma – up 16.1% from 3.920 ma in 2015.  Kansas corn percent harvested-to-planted acres is projected to be 94.8% in 2016 in comparison to 94.5% in 2015.

Likely Impact on Corn Market Expectations for “New Crop” MY 2016/17

Using the USDA’s June 10th World Agricultural Supply and Demand Estimates (WASDE) report projected 2016 U.S. corn yield of 168.0 bu/ac, U.S. corn production in 2016 would be 14.540 billion bushels (bb) – up 110 million bushels (mb) from 14.430 bb in the June 10th WASDE.  All else being equal with total corn use of 14.170 bb unchanged from June, the USDA’s forecast of ending stocks for “new crop” MY 2016/17 would also be increased by the same amount up to 2.118 bb, with percent ending stocks-to-use up to 14.9% in the July 12th WASDE report – up from 14.2% in June.

Projected U.S. corn prices for “new crop” 2016/17 may be adjusted marginally lower in the July 12th WASDE – down approximately $0.05-$0.10 /bu to a range of $3.15-$3.75 (midpoint = $3.45 /bu).

B. Soybean Acreage in the U.S. & Kansas

The USDA projected 2016 U.S. soybean planted acreage to be 83.688 ma – down 281,000 acres (-0.3%) from pre-report trade expectations.  Planted acreage of 83.688 ma in 2016 would be the largest amount on record, being up from 82.650 ma planted in 2015, the current record of 83.276 ma in 2014, 76.840 ma in 2013, and 77.198 ma in 2012.  See Table 1 & Figure 2.

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The USDA also projected 2016 U.S. soybean harvested acreage to be a record high 83.037 ma – up from 81.814 ma in 2015, the current record high of 82.591 ma in 2014, 76.840 ma in 2013, and 77.198 ma in the drought year of 2012.  Percent harvested-to-planted acres is projected to be 99.2% in 2016 in comparison to 99.0% in 2015, 99.2% in 2014 and 2013, and 98.6% in the drought year of 2012.

Kansas 2016 soybean planted acreage is projected by the USDA to be 4.150 ma – up 6.4% from 3.900 ma in 2016 (Table 2).  Projected 2016 Kansas soybean planted acreage of 4.150 ma was up 300,000 acres from the March 30th USDA Prospective Plantings report, and up 3.8% to 15.3% from Kansas soybean plantings in the range of 3.600-4.000 ma over the 2013-2015 period.  Similarly, Kansas 2016 soybean harvested acreage is projected to be 4.110 ma – up 6.5% from 3.860 ma in 2015.  Kansas soybean percent harvested-to-planted acres is projected to be 99.0% in 2016 versus to 99.0% in 2015.

Likely Impact on USDA U.S. Soybean Market Expectations for “New Crop” MY 2016/17

Using the USDA’s June 10th WASDE report projected 2016 U.S. soybean yield of 46.7 bu/ac, U.S. soybean production in 2016 would be 3.878 bb – up 78 mb from 3.800 bb in the June 10th WASDE.  All else being equal with total soybean use of 3.940 bb unchanged from June, the USDA’s forecast of ending stocks for “new crop” MY 2016/17 would also be increased by the same amount up to 338 mb, with percent ending stocks-to-use up to 8.6% in the July 12th WASDE report – up from 6.6% in June.  Similar to corn, projected U.S. soybean prices for “new crop” 2016/17 may be adjusted moderately lower in the July 12th WASDE – down approximately $0.10-$0.20 /bu to a range of $8.60-$10.10 (midpoint = $9.35)

C. Grain Sorghum Acreage in the U.S. & Kansas

The USDA projected 2016 U.S. grain sorghum planted acreage to be 7.225 ma – up 75,000 acres (+1.0%) from trade expectations.  Planted acreage of 7.225 ma in 2016 is down sharply from 8.459 ma planted in 2015, but up from 7.138 ma in 2014, less than 8.076 ma in 2013, and up from 6.259 ma in 2012, 5.451 ma in 2011, and the low since at least 1970 of 5.369 ma in 2010.  See Table 1 and Figure 3.

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The USDA also projected 2016 U.S. grain sorghum harvested acreage to be 6.456 ma – down from 7.851 ma in 2015, comparable to 6.401 ma in 2014, and 6.586 ma in 2013, and markedly higher than 4.995 ma in the drought year of 2012, the low since at least 1970 of 3.945 ma in 2011, and 4.806 ma in 2010.  Percent harvested for grain-to-planted acres is projected to be 89.4% in 2016 compared to 92.8% in 2015, 89.7% in 2014, 81.5% in 2013, 79.8% in the drought year of 2012, the low since year 2000 of 72.4% in 2011, and 89.5% in 2010.

Kansas 2016 grain sorghum planted acreage is projected by the USDA to be 3.150 ma – down 7.4% from 3.400 ma in 2016 (Table 2).  Projected 2016 Kansas grain sorghum planted acreage of 3.150 ma was unchanged from the March 30th USDA Prospective Plantings report, but down 250,000 acres from 3.400 ma in 2015, up 300,000 acres from 2.850 ma in 2014, and equal to 2013.  Similarly, Kansas 2016 grain sorghum harvested acreage is projected to be 2.900 ma – down 9.4% from 3.200 ma in 2015.  Kansas grain sorghum percent harvested for grain-to-planted acres is projected to be 92.1% in 2016 in comparison to 94.1% in 2015.

Likely Impact on USDA U.S. Grain Sorghum Market Forecasts for “New Crop” MY 2016/17

Using the USDA’s June 10th WASDE projected 2016 U.S. grain sorghum yield of 65.0 bu/ac, U.S. grain sorghum production in 2016 would be 420 mb – up 13 mb from 407 mb in the June 10th WASDE.  All else being equal with total grain sorghum use of 420 mb unchanged from June, the USDA’s forecast of ending stocks for “new crop” MY 2016/17 would also be increased by the same amount up to 56 mb, with percent ending stocks-to-use up to 13.3% in the July 12th WASDE report – up from 10.2% in June.

Projected U.S. grain sorghum prices for “new crop” 2016/17 may be adjusted marginally lower (along with U.S. corn prices – sorghum’s primary substitute feedgrain) in the July 12th WASDE – down approximately $0.05-$0.10 /bu to a range of $2.90-$3.50 (midpoint = $3.20 /bu).

D. Wheat Acreage in the U.S. & Kansas

D1. Wheat Planted Acreage – Total & By Class

The USDA projected 2016 U.S. wheat planted acreage to be 50.816 ma – up 1.084 ma (+2.2%) from pre-report trade expectations – and the lowest amount since 1970.  Planted acreage of 50.816 ma in 2016 is down 3.828 ma (down 7.0%) from 54.644 ma planted in 2015, 56.841 ma in 2014, 56.236 ma in 2013, and 55.294 ma in 2012.  See Table 1 and Figure 4.

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By type or class of wheat, planted acreage of 2016 U.S. winter wheat of 36.538 ma came in 246,000 acres (+0.7%) above pre-report trade expectations – which is the lowest level since and least 1970 – comparable to a low of 36.576 ma in 2010.  Kansas 2016 winter wheat planted acreage is projected to be 8.500 ma – down 7.6% from 9.200 ma in 2016 (Table 2).  Projected 2016 Kansas wheat planted acreage of 8.500 ma was unchanged from the March 30th USDA Prospective Plantings report, but down 7.6% to 11.5% from Kansas wheat seedings in the range of 9.200-9.600 ma over the 2013-2015 period.

Planted acreage of 2016 U.S. other spring wheat of 12.133 ma came in 493,000 acres (+4.2%) above pre-report trade expectations and comparable to 13.247 ma in 2015, 13.025 ma in 2014, the recent low of 11.606 ma in 2013, and 12.259 ma in 2012.  Planted acreage of 2016 U.S. durum wheat of 2.145 ma came in 151,000 acres (+7.6%) above pre-report trade expectations and comparable to 1.936 ma in 2015, 1.407 ma in 2014, 1.400 ma in 2013, and 2.138 ma in 2012.  See Table 1 and Figure 5.

D2. Wheat Harvested Acreage – Total & By Class

The USDA also projected 2016 U.S. wheat harvested acreage to be 44.093 ma – down from 47.094 ma in 2015, 46.385 ma in 2014, 45.332 ma in 2013, and 48.758 in 2012 – and is the lowest acreage of U.S. wheat planted since 43.564 ma in 1970.  Percent harvested-to-planted acres is projected to be 86.8% in 2016 compared to 86.2% in 2015, the near term lows of 81.6% in 2014 and 80.6% in 2013, and 88.2% in 2012. See Table 1 and Figure 4.

By type or class of wheat, harvested acreage of 2016 U.S. winter wheat of 30.176 ma is projected to be down from 32.257 ma in 2015. Kansas 2016 winter wheat harvested acreage is projected to be 8.100 ma – down 6.9% from 8.700 ma in 2016, while Kansas winter wheat harvested-to-planted acres are projected to be 95.3% in 2016 in comparison to 94.6% in 2015.

Harvested acreage of 2016 U.S. other spring wheat of 11.835 ma is projected to be down from 12.941 ma in 2015.  Harvested acreage of 2016 U.S. durum wheat of 2.082 ma is forecast to be up from 1.896 ma in 2015.  See Table 1 and Figure 5.

Likely Impact on USDA U.S. Wheat Market Forecasts for “New Crop” MY 2016/17

Using the USDA’s June 10th WASDE projected 2016 U.S. wheat yield of 48.6 bu/ac, U.S. wheat production in 2016 would be 2.143 bb – up 66 mb from 2.077 bb in the June 10th WASDE.  All else being equal with total wheat use of 2.132 bb unchanged from June, the USDA’s forecast of ending stocks for “new crop” MY 2016/17 would also be increased by the same amount up to 1.116 bb, with percent ending stocks-to-use up to 52.3% in the July 12th WASDE report – up from 49.25% in June.

Projected U.S. wheat prices for “new crop” 2016/17 may be adjusted marginally lower (along with U.S. corn, soybean, and grain sorghum prices) in the July 12th WASDE – down approximately $0.05-$0.15 /bu to a range of $3.50-$4.30 (midpoint = $3.90 /bu).

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