Planting Report Comments

DJ High Prices Drive Corn Planting Up, Soy Acres Slip

By Bill Tomson

Of DOW JONES NEWSWIRES

WASHINGTON(Dow Jones)--U.S. farmers chasing high prices will be planting
92.178 million acres of corn this year, a 5% increase from last year, while
land going into soybean production is expected to slip slightly, the U.S.
Department of Agriculture said Thursday in its annual Prospective Plantings
report.

"Planted [corn] acreage is expected to be up in most states compared to last
year due to higher prices and grower expectations of better net returns," the
USDA said in the report.

The new corn planting forecast is also slightly higher than the 92 million
acres USDA predicted in late February during its annual outlook conference and
surpassed most analysts expectations.

Future prices for corn recently traded above 21/2-year highs on strong global
demand and worries about low supplies.

And the USDA confirmed in a separate report Thursday that there is indeed a
tight market. The Grain Stocks report that showed corn stockpiles across the
U.S. total just 6.52 billion bushels, 15% less than about a year ago on March
1, 2010.

Soybean stockpiles are also lower than a year ago, but the drop wasn't as
steep. Soybeans stocks, whether stored on farms or off, total 1.25 billion
bushels. That's a 2% decrease from the 1.27 billion bushels of stockpiles about
a year ago.

Soybean supplies are still tight though and global demand, especially from
China remains high, according to analysts surveyed by Dow Jones Newswires.
China has become the largest foreign market for U.S. agriculture goods and its
appetite for U.S. soybeans continues to grow.

The USDA predicted Thursday that soybean acreage this year, although expected
to drop about 1% last year, will still be the the third largest planted crop
ever in the U.S.

Farmers are forecast to plant 76.6 million acres with soybeans this year,
down from 77.404 million acres in 2010 and 77.451 million acres in 2009.

But analysts were still expecting the USDA report to confirm that some
farmers are switching soybean acreage over to corn or even cotton, which has
seen strong increases in futures prices in recent months thanks to expected
production declines in China and Pakistan.

Cotton acreage in the U.S. this year is now forecast at 12.566 million acres,
a 15% increase from 10.973 million acres last year, according to the
Prospective Plantings report.

"Cotton acreage increases are expected in every state," the USDA said
Thursday.

The USDA also released an increase in its forecast for the acreage farmers
will plant with wheat. The new prediction is for 58.021 million acres and
that's about an 8% increase above the 53.603 million acres planted this year.

By Bill Tomson, Dow Jones Newswires; 202-646-0088; bill.tomson@dowjones.com