U.S. farmers planted more corn than they intended in March, sowing the third-highest crop since World War II and surprising analysts who had expected a decline. Prices fell to the lowest since April.
Corn, the country’s largest crop, was sown on 94.148 million acres, the third-most since 1944, the U.S. Department of Agriculture said in a report Thursday in Washington. That’s more than the agency’s March forecast, based on a survey of farmers before planting season, for 93.601 million. The average estimate of analysts surveyed by Bloomberg was for 92.781 million. Farmers increased plantings 7 percent from the 88 million sown in 2015.
Corn inventories from last year’s crop rose 6 percent to 4.722 billion bushels as of June 1, the most for the date since 1988. Use from March to May was estimated at 3.1 billion down from 3.3 billion a year earlier, pushing reserves above the 4.52 billion expected by analysts surveyed by Bloomberg.
The latest data may reignite concerns about the global glut of grains. The March USDA estimate for corn plantings also exceeded analysts’ projections at the time and sent futures tumbling to a 17-month low.
Prices Drop
On the Chicago Board of Trade, corn futures for September delivery slumped 3.2 percent to $3.655 a bushel at 11:17 a.m. local time, after touching $3.6025, the lowest for the contract since April 5.
Corn futures entered a bull market earlier this month on the Chicago Board of Trade as traders worried about production potential in the U.S. and Brazil, the world’s biggest exporters.
But more recently, corn has fallen by more than 10 percent as U.S. crop conditions held stable throughout June. The North American grain is beginning its reproduction phase, a key period in yield development.
Soybean acreage will rise to a record 83.688 million acres, up from the 82.65 million sown last year and exceeding the March forecast of 82.236 million, the USDA also said in the report. The average estimate of analysts surveyed by Bloomberg was 83.947 million acres.
Soy stockpiles on June 1 rose to 870 million bushels, up from 627 million a year earlier. Inventories are the most since 2007 and topped analysts’ expectations for a gain to 831 million.
The USDA report is based on a survey of about 70,500 farmers and more than 11,000 field samples collected in the first two weeks of June as the planting season neared completion.
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