Corn futures in Chicago are expected to fall sharply after the government said U.S. farmers planted 92.28 million acres to the crop this year, above analysts’ expectations and the second-highest total in the past 67 years.
Estimated corn plantings would be up 4.6 percent from 88.19 million acres in 2010 and trail only the 93.5 million acres seeded in 2007 as the highest since 1944, according to the U.S. Department of Agriculture’s Acreage report June 30.
The USDA’s estimate caught the grain trade by surprise, and likely will send CME Group corn futures tumbling near the 30-cent daily trading limit amid an outlook for higher supplies, analysts said. Corn futures have already dropped as much as 20 percent from a record $7.99 ¾ a bushel earlier this month.
“The party is over for the corn bulls,” Chad Henderson, an analyst with Prime-Ag Consultants, Inc., in Brookfield, Wis., said in an e-mail. A higher than expected corn stockpile estimate in another USDA report released June 30 is also bearish for the market, he said.
Analysts expected corn plantings of about 90.78 million acres, based on the average estimate in a Dow Jones Newswires survey.
In overnight electronic trading, July corn futures rose 2 ½ cents to $7.00 ½ a bushel, while December futures, which reflect expectations for this fall’s harvest, fell 1 ¾ cents to $6.48 ¾.
December corn futures “could have difficulty holding a $6 handle,” Mike Zuzolo, president of Global Commodity Analytics & Consulting LLC, said in a report.
The USDA acreage report signals some relief for livestock and dairy producers, who’ve seen margins come under pressure from soaring feed costs this year. Barring any widespread weather problems this summer, the nation’s farmers may be headed toward a record corn harvest, based on USDA estimates.
Farmers are expected to harvest 84.9 million acres, the USDA said. Based on a previous USDA estimate for an average U.S. yield of 158.7 bushels an acre, this year’s acreage would generate a crop of about 13.47 billion bushels, up 8.2 percent from last year and above the current record of 13.09 billion bushels in 2009.
Planting got off to a slow start this spring because of wet conditions across much of the Midwest, and was at a “virtual standstill” during mid-April due to heavy rains and lowland flooding in the central and eastern Corn Belt, the USDA said.
Planting delays continued during early May, but mostly-dry weather favored fieldwork in Iowa and Nebraska, the No. 1 and No. 3 corn producers, the USDA said. Illinois is No. 2. By June 12, corn planting was “virtually complete,” the USDA said.
Estimated corn plantings would be up 4.6 percent from 88.19 million acres in 2010 and trail only the 93.5 million acres seeded in 2007 as the highest since 1944, according to the U.S. Department of Agriculture’s Acreage report June 30.
The USDA’s estimate caught the grain trade by surprise, and likely will send CME Group corn futures tumbling near the 30-cent daily trading limit amid an outlook for higher supplies, analysts said. Corn futures have already dropped as much as 20 percent from a record $7.99 ¾ a bushel earlier this month.
“The party is over for the corn bulls,” Chad Henderson, an analyst with Prime-Ag Consultants, Inc., in Brookfield, Wis., said in an e-mail. A higher than expected corn stockpile estimate in another USDA report released June 30 is also bearish for the market, he said.
Analysts expected corn plantings of about 90.78 million acres, based on the average estimate in a Dow Jones Newswires survey.
In overnight electronic trading, July corn futures rose 2 ½ cents to $7.00 ½ a bushel, while December futures, which reflect expectations for this fall’s harvest, fell 1 ¾ cents to $6.48 ¾.
December corn futures “could have difficulty holding a $6 handle,” Mike Zuzolo, president of Global Commodity Analytics & Consulting LLC, said in a report.
The USDA acreage report signals some relief for livestock and dairy producers, who’ve seen margins come under pressure from soaring feed costs this year. Barring any widespread weather problems this summer, the nation’s farmers may be headed toward a record corn harvest, based on USDA estimates.
Planting got off to a slow start this spring because of wet conditions across much of the Midwest, and was at a “virtual standstill” during mid-April due to heavy rains and lowland flooding in the central and eastern Corn Belt, the USDA said.
Planting delays continued during early May, but mostly-dry weather favored fieldwork in Iowa and Nebraska, the No. 1 and No. 3 corn producers, the USDA said. Illinois is No. 2. By June 12, corn planting was “virtually complete,” the USDA said.
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