Sunday 08 July 2012
US corn sowings rose this year by even more than previously forecast, as lower prices dissuaded farmers from growing cotton, Informa Economics said, opening the countdown to the next key set of American crop data.
The influential analysis group raised by 700,000 acres to 96.8m acres its forecast for US corn plantings this year - representing an increase of 7.7m acres year on year.
The upgrade, to the largest area since the 97.2m acres planted in 1937, reflects one of the first forecasts from a major analysis group in the run-up to a much-watched US Department of Agriculture report on June 29 on domestic crop sowings.
And it contrasts with expectations earlier in the year that revival in soybean prices, compared with corn, over the spring had lured many growers to plant the oilseed instead.
However, Informa raised its estimate for soybean seedings too, by 200,000 acres to 76.0m acres, a rise of 1.0m acres year on year.
The casualty was cotton, for which the sowings estimate was cut by 1.0m acres to 13.0m acres.
Many investors have forecast that the continued decline in cotton prices over the spring would make farmers think twice about sowing the crop.
Goldman Sachs earlier this week forecast "higher cotton prices in the near term, as we expect the USDA will lower its US acreage forecast on June 29".
Market reaction ...
Source: Argentine Beef Packers S.A.
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