Darrel Good, an agricultural economist at the Univ. of Illinois, thinks some producers, especially in the northwest Corn Belt, will throw in the towel earlier than the second week of June and take crop insurance that becomes available about June 5.
“In parts of Iowa, Minnesota, Wisconsin and the Dakotas, they will plant corn until the first week of June,” he said. After that, unplanted corn acres will be switched to soybeans, written off for crop insurance or simply abandoned, he said.
The US Department of Agriculture said in its latest Crop Progress report that 86 percent of the crop was planted as of May 26, down from the five-year average of 90 percent.
Because of a wet spring, farmers had to frenetically plant as much of the 2013 crop as they could earlier in May, when a window of dry weather allowed a concentrated burst of fieldwork. But the wet weather returned and planting over the long Memorial Day weekend was sporadic, leaving a sizeable chunk of about 10 million acres still unplanted, Setzer said.
What happens to that final 10 million acres is an interesting question, he noted. Rains may slow down additional planting this week, Setzer said, but farmers would still have the opportunity to plant shorter-maturity corn that may take only 85 to 90 days to grow rather than the usual 105 days. He said a certain number of producers will stay loyal to corn rather than switching to later-planted soybeans because corn remains the more profitable crop. And he said that, despite some risk premium in prices, the attitude in the futures market is still that “rain makes grain.”
After mid-June, planting soybeans over corn will become a necessity, Setzer said. Corn planted close to the drop-dead date of June 15 would probably yield about 10-15 bushels less than the trend line 158 bushels per acre, he said. But he contended that the lower yields would still be acceptable.
“Even reduced yields of 145 bushels (per acre) would produce a comfortable carryout,” he said. “At 155 bushels per acre, there would be a carryout of about two billion bushels,” he said, which would send corn futures prices markedly lower.
He predicted some spikes in corn futures prices over the next couple of weeks if rain continues, but he doesn’t foresee soaring prices. A panicked market isn’t likely because “a wet year doesn’t get as much attention as a dry year,” he said.