USDA’s March 30 Prospective Plantings report that predicts growers will plant 15 percent more corn in 2007 than last year—the most since 1944—pushed corn futures prices down sharply the first two days following release of the report.
Corn prices experienced their biggest two-day decline in more than a decade. USDA says farmers will plant 90.5 million acres of corn this spring, at the high end of analysts’ expectations.
Much of the additional corn acres will come from soybeans. The report says soybean acres are expected to drop 11 percent to 67.1 million acres.
Bill Roenigk, senior vice president and chief economist of the National Chicken Council, says that while he is encouraged by the report that shows corn acres will increase, the outlook is clouded by the predicted drop in soybean acres, since the poultry industry is a major buyer of soybean meal as well as corn. He also adds that planting intentions are not the same thing as a harvest. Roenigk also says that even with the additional acres, corn prices will remain at historically high price levels.