Analysts at the Congressional Budget Office are penciling lower prices for corn, wheat and soybeans into their budget assumptions, according to documents that circulated among commodity traders. The preliminary estimates are prepared for consultations with other agencies and will be refined in coming weeks.
In the unofficial balance sheets, CBO suggests an average price of $3.48 a bushel for the 2015 corn crop, $8.92 for soybeans and $4.97 for wheat. All of those are lower than USDA’s estimates for the average price for this year’s crops. And they are lower than a University of Missouri think tank’s projected prices for 2015 crops of $3.89 a bushel for corn, $9.10 for soybeans and $5.36 for wheat.
CBO’s balance sheets differ on another aspect as well. It projects a drop of 2 million acres in soybean plantings while corn acreage is down marginally. Many analysts say soybeans are a more profitable choice than corn following this fall’s record harvests, so soybean sowings should rise – Informa says by nearly 4 million acres – in 2015 while corn acreage falls.
USDA says it drafts its “baseline” estimates of U.S. crop production and usage on its own. The long-term estimates are released in late February at USDA’s Outlook Forum and are based on conditions at the end of harvest time.