Low market prices will deter farmers from planting as much corn as they planned a month ago, but a record corn crop is still on the horizon, said two Purdue University economists on Monday. The mammoth crop would create the largest corn stockpile since the late 1980s while the already-large soybean stockpile grow bigger still.
“We think planted corn acreage could easily fall 1 million acres below” the estimated 97 million acres in USDA’s Prospective Plantings report,” said economist James Mintert. “It might even be more that that…In our balance sheets, we simply move that million acres over to soybeans.”
Prices for most agricultural commodities have weakened because of the coronavirus pandemic and accompanying economic slowdown. Corn has been hurt in particular by the plunge in ethanol sales. A large portion of the corn crop, from 35-40 percent, is used to make corn ethanol. The alternative to corn in most of the Farm Belt is soybeans.
With normal weather and yields, the corn harvest could total 15.6 billion bushels, the largest ever, even if plantings drop to 96 million acres. If soybean plantings rise to 84.5 million as Mintert suggested, the crop would total 4.1 billion bushels, the fourth-largest on record. The USDA estimates of 97 million acres of corn and 83.5 million acres of soybeans were based on a survey of 80,000 producers in early March.
Mintert and colleage Michael Langemeier said the large crops would translate into large stockpiles that would persist for months. The corn “carry over” when the 2021 crop is ready for harvest “is going to be big number. It’s a carry-over we haven’t seen since the late 1980s,” said Mintert.
The corn stockpile would equal a 15-week supply – 29 percent of expected annual use – when eight weeks is considered adequate. Soybeans stocks, at 18 percent of expected use, would be an increase from the six-week supply that is expected on hand when this year’s crop is mature, and they would the the third-largest ever.