Concerns of above-normal prevent planting acres and forecast dry weather during the peak growing season are clouding US corn output prospects for marketing year 2022-23 (September-August), with the crop already expected to be lower on the year at a time when global supplies are also limited.
Inclement weather conditions in parts of the US during the peak corn-planting period kept farmers away from their fields, raising concerns that farmers would leave fields fallow and opt instead to take “prevented planting,” also called “prevent plant,” insurance payments.
Prevented planting acreage and weather conditions during the peak planting season are important harvest factors every year, but this year they are more so, as corn stocks are shrinking globally while prices are sharply higher amid the backdrop of the Russia-Ukraine war, weather troubles in South America and lower production in the US.
The concern about prevented planting acreage is highest in North Dakota and Minnesota, as planting in these states was reported to be farthest behind their five-year averages as of June 5.
Though final planting dates for corn varies by regions in the US, the last dates fall between the end of May through June 5. After the final planting date, farmers can opt for a prevented plant payments.
“There will be a fair amount of prevent plant in areas — especially toward the western edge of Minnesota and into the eastern Dakotas — farmers wanted to plant corn and many still have been trying extremely hard, but the clock is about done ticking,” Minnesota corn and soybean farmer Jonathan Mikkelson said. Opting for prevented planting payments has been the last resort for farmers this year given that market opportunities are good, he added.
“The market was calling for corn and crop planting, MIkkelson said. “Farmers were poised to plant, but in some cases weather and field conditions just didn’t allow for planting before time ran out.”
Shifting acreage
The Upper Midwest received record rainfall in April and May, and it has been a struggle for farmers to put their seeds in the ground.
“Certainly, the prevent plant acres will be higher than last year’s 2.1 million acres given the wetness,” said Pete Meyer, head of Grain, Oilseed and Advanced Feedstocks at Platts Analytics. “If I had to guess, probably around 3.5 million-4 million acres,” he said.
Backing up Meyer’s assertion, the University of Illinois, in a June 8 report, suggests that US corn prevented planting in 2022-23 is likely to be greater than normal at 3.2 million acres, compared with the 2007-2021 annual average of 2.5 million acres.
Arlan Suderman, chief commodities economist with StoneX, while he echoed that this year’s delayed planting is expected to prevent some farmland from being planted, said conditions could also contribute to “shifting acres” between crops.
US corn could lose a half-million acres in the South, mostly to cotton and soybeans due to early planting problems and the surge in cotton and soybean prices during spring, and more than 2 million acres in Minnesota and North Dakota, Suderman said.
“Normally, the market wouldn’t worry too much about lost acres in northern Minnesota and North Dakota, but this is a year when every acre counts,” said Suderman, referring to the global shortfall of grain.
Fields typically planted with corn in the US have already seen a switch to soybeans this year owing to high fertilizer costs, making it only the third time in US history when farmers are likely to plant more soybean than corn in the country. As fertilizer prices soar to near-record highs, corn being a fertilizer-intensive crop currently offers lower returns compared with soybeans. US corn production in the MY 2022-23 is already expected to be 4.3% lower on the year at 14.5 billion bushels.
Above-normal temperatures forecast
While planting beyond normal final planting dates is raising concerns of yield losses, Kyle Tapley, senior agricultural meteorologist with Colorado-based private weather service Maxar, said such concerns for US corn are currently limited.
“Over the past week or so, planting has caught up to near the…