USDA Raises Wheat and Corn Acreage Forecast, But Cuts U.S. Soybeans, Surprising Market

In a new quarterly USDA report dated March 31, forecasts for 2023 U.S. wheat and corn acreage were higher than analysts expected, while soybean acreage was lower than expected, leading quotes to rise. And data from the USDA's quarterly inventory report showed a decline from a year ago, which also supported prices.

According to the USDA forecast, 91.996 million acres will be sown with corn in the United States in 2023 (last year the forecast was 89.49 million acres, and 88.48 million acres were actually planted), while analysts estimated the area at 90.88 million acres, and the February Agricultural Forum - 91 million acres.

Lower nitrogen fertilizer costs will make corn acreage more profitable, compared to soybeans , which will see 87.5 million acres planted, matching last year's level, although last year's forecast was 90.96 million acres and analysts estimated plantings at 88. 24 million acres.

All- wheat wheat in the US is forecast to be 49.9 million acres, up 9% from last year's 45.7 million acres (with a forecast of 47.35 million acres), although analysts estimated it at 48.85 million acres. The forecast for winter wheat sowing areas was unexpectedly increased to 37.5 million acres, which will exceed last year's figure by 13%, while analysts estimated them at 36.25 million acres. At the same time, spring wheat sowing area will decrease by 2% compared to last year, from 11.8 to 10.57 million acres, and durum wheat will amount to 1.78 million acres against the market's expected 1.67 million acres.

Stockpiles of soybeans, wheat and corn in the US as of March 1 were lower than expected and significantly lower than last year, and amounted to:

• corn - 188 million tons (199.39 million tons last year and 189.8 million tons according to the average estimate of analysts),
• soybeans – 45.86 million tons (52.55 million tons last year and 47.4 million tons according to the average estimate of analysts),
• wheat - 25.75 million tons (27.9 million tons last year and 25.4 million tons according to the average estimate of analysts).

On Friday at the Chicago SWOT, May futures rose in price again:

• for corn - by 1.7% to $260/t (294.8 $/t last year),
• for soybeans – by 2.1% to $553.2/t (last year $594.6/t).

At the same time, winter wheat remained at the level of $254.4/t ($369.6/t last year), and spring wheat in Minneapolis grew by 1.8% to $329.1/t ($396.6/t last year) .