As of the May 27 Crop Progress Report, only 58% of intended corn acres have been planted, compared to a historical average of 90%. While the max coverage planting date for corn has already passed in Iowa (May 20), growers in Illinois, Indiana and Ohio have until June 5 to either get seed in the ground, file for prevent plant payments for maximum coverage or risk widening the planting window with crop insurance coverage dwindling by the day.
According to a recent Farm Journal Pulse poll, 34% of corn growers plan to file for prevent plant payments on at least some of their acres in 2019. Less than half (45%) of the 1,017 growers surveyed, said they do not plan to file for any prevent plant payment. Twenty-one percent remain undecided as the deadline looms.
USDA will provide an update on planted acres Monday afternoon, but there is little expectation for expanded planting progress as rains have continued over much of the corn belt.
“The best we could probably expect to get progress done this week is 10% on the national basis, maybe more, but we’re going to have at least 20 million acres, at least that much,” University of Illinois Ag Economist Dr. Gary Schnitkey told AgriTalk Radio host Chip Flory on Friday. “And I don’t know how the market reacts to that.
“I think the two choices right now are would be still take the prevent plant corn or plant corn,” Schnitkey explained. “There’s a lot of downside price risk to soybean, so sticking to corn and thinking about that for a while would probably be a good thing. And then just think about ‘Should I take a payment or plant corn?’ And that’s going to be a really, really tough decision.”
Any way you slice it, it will be a short corn crop in 2019 according to Schnitkey, and that should lead to strong price recovery.
“So $5 corn is a possibility and higher, depending on the scenario, and depending on what happens rest of the summer,” Schnitkey said. “But we could have a very short crop this year, and you would expect corn prices to increase. And actually, I’m a little surprised that they haven’t increased so far up to this point.”
Source: John Herath, Farm Journal Media
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