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June USDA Acreage Report Preview

This coming Friday’s annual Crop Acreage report should confirm U.S. producers shifted acreage from corn into soybeans this spring after they planted the most corn in 10 years in 2023. Excessively wet spring weather in parts of the Corn Belt has led to speculation the acreage shift might be even larger than USDA’s March Prospective Plantings report indicated, although we still expect both corn and soybean area to be slightly larger.

March corn planting intentions came in at 90.0 million acres, down 4.9% from 2023 acreage, with soybean planting intentions at 86.5 million, up 3.5% from last year. In the past 10 years, the June acreage report pegged corn area higher than the March intentions six times, three times by moe than one million acres, most notably last year’s 2.1-million-acre jump. Corn area was lowered by more than one million acres twice, most notably in 2020 when it was 5.5 million acres lower. Soybean acres also rose in June six of the past 10 years, but fell four of the past five, three times by more than 2.5 million acres.

The Crop Acreage report has provided significant surprises for the corn and soybean markets relative to trade expectations in recent years. The June corn area estimate has differed by more than one million acres from the average of pre-report trade expectations in five of the past 10 years, including three times by more than two million. The most glaring difference was in 2019, when the average of expectations was 5.04 million acres too low. Note, however, that actual 2019 corn plantings wound up closer to the trade average than USDA’s June estimate, as wet weather forced record large prevented planting claims.  Interestingly, the average of pre-report estimates of U.S. soybean acreage has been too high for 10 consecutive years, running more than one million acres too high in four of the past five years and more than 4 million acres too high both last year and in 2019. Clearly that suggests some potential for the soybean market to receive a positive surprise next Friday.

How have the markets reacted to the June reports? The two charts below show where corn and soybean futures closed on report day and where they closed two weeks later, in relation to where they were ahead of the report. In the past 10 years, corn futures fell on report day by 20 cents or more three times and rose by 20 cents or more twice. Corn futures have not tended to extend report day moves, moving farther in the same direction over the following two weeks only in 2014, 2015, 2016 and 2022. Soybean futures also extended their report day move in only four of 10 years – 2014, 2017, 2022 and 2023. Last year, the market rallied 77 1/2 cents on report day and two weeks later was up $1.12 1/2. Soybean futures have moved more than 30 cents on report day six of the past 10 years, rising five times and falling only once.

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