A topic that is quickly gaining market attention is possible corn and soybean acreage in the United States this coming planting season. Two major firms have released their acreage projections and are showing a smaller corn acreage figure than last year and an increase in soybean plantings, which is fully expected by trade. The number of acres expected to shift is being questioned though.

Corn acres are expected to decline from 1.6 million to 1.8 million from last year. Some analysts have been projecting a decline to corn acres of 5 million, which is possibly needed to prevent corn reserves from building to a burdensome level. While any of these acres would help build U.S. soybean reserves, we may need to see even more plantings if demand builds from its current estimate.

The soybean harvest in Brazil is progressing at a quicker than normal pace this year. This is having two impacts on the global market. For one it is going to put more soybeans into the global supply line than expected at an earlier time frame. This will also lead to an early safrinha planting season. The safrinha crop may see less stress as a result, mainly from a late-season drought or an early frost. Analysts are starting to show more optimism on the Brazilian corn crop as a result.

The United States is starting to see even more competition from South America in global corn trade. At the present time, the USDA is projecting U.S. corn exports this year of just over 50 million metric tons. Brazil corn exports are forecast at 55 mmt given the expansion the country has seen in corn production in recent years.

Argentina is also going to see a build in corn exports this year following a return to normal production weather. The current Argentine corn export forecast is at 40 mmt, a year-to-year increase of 16 mmt. These larger crops have swayed importers away from the U.S. and will likely continue to do so.

We are starting to see more analysts put out balance sheet estimates for the 2024/25 marketing year. One of the most recent came from the Marex group, which points out that U.S. ending stocks on corn and soybeans will likely increase next year, even if corn acres decline.

Corn plantings are forecast to decline 5 million this year as crop rotations become more normal. When combined with a trend yield, this would give the U.S. a 14.8 billion bu corn crop, 460 million bu less than last year. If demand holds steady with current year projections, it will leave the U.S. with a carryout of 2.54 billion bu, 400 million bu more than the projection for the end of the 2023/24 marketing year.

A similar scenario is being forecast for the soy complex. If the U.S. sees 4 million corn acres shift to soybeans to would lead to a 4.3 billion bu crop with trend yields. This is up 180 million bu from last year. Marex is pointing to elevated crush but fewer exports as South America competes for business and China cuts back on soybean usage. Soybean ending stocks of 350 million bu are possible, up 100 million bu from this year. The real concern for soybeans is from the global side, where ending stocks could increase as much at 514 million bu.

The friendliest outlook for balance sheets is on wheat. Wheat will likely pick up some of the lost corn acres, but not a huge amount. If we see steady acreage and a return to trend yields on wheat, it will leave the U.S. with 735 million bu of ending stocks, 75 million bu more than last year. The world wheat supply is expected to shrink for the 5th consecutive year though, which favors the U.S. export program.

The USDA has also released its long-range baseline supply and demand estimates for U.S. corn, soybeans, and wheat. The USDA is projecting a U.S. corn yield of 183.5 bushels per acre for the 2024/25 marketing year and increases this by 2 bpa for the next 10 years. A new crop carryout of 2.09 billion bu is also being predicted, which is a 14 percent stocks to use. The carryout on corn remains under 17 percent through the 2032/33 marketing year, which is considered to be a non-rationing level.

The USDA is predicting a U.S. soybean yield of 52.5 bpa for 2024/25, and takes this up 0.5 bpa for the next 10 years. A soybean carryout of 310 million bu is forecast for this year and holds near 300 mbu for the next decade. This will keep the stocks to use on soybeans at 6.5 percent through the 2032/33 marketing year, a point where price rationing tends to begin.

The U.S. wheat balance sheets see little expected change for the next decade. Wheat yield is projected at 49.6 bpa for this year and climbs by 0.25 and 0.5 bpa over the next 10 years. Wheat ending stocks are forecast at 710 mbu for 24/25, and hold between there and 760 mbu through the 2032/33 marketing year. This is a 36 percent stocks to use and it little changed from today’s level.

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