The scuttlebutt in the trade, even in the numbers released by USDA at its February Agricultural Outlook Forum, is that the economics will push farmers to plant a lot more corn acres this year.
Ag Economist Gary Schnitkey has updated budgets for corn and soybeans across the state. He knows USDA increased its expectation for corn acres around the nation by about 3 million acres but says he does not expect a big shift to corn in Illinois, “What we find is that corn is projected to be more profitable than soybeans. This is the first year in a while that has happened. However, our budgets do not suggest shifting to more corn production. Particularly corn-after-corn is less profitable than soybeans. So, it is status quo for the central Illinois area with a 50/50 corn/soybean rotation being more profitable for 2019.”
This holds for northern and central Illinois. Southern Illinois still has a regionalized economic bias to plant soybeans. Soybeans make more money there says Schnitkey, “However, the big thing right now is the upcoming USDA Prospective Plantings report and whether we will see shifts from soybean to corn which some people are expecting. These budgets would say in the heart of the corn belt, or in the corn belt in general, that you won’t see shifts from soybeans to corn. So, you have to see those shifts from someplace else and there are limited opportunities there.”
USDA in its February Outlook meeting projected U.S. farmers would plant about three percent more corn acres this season than last and almost five percent fewer soybean acres. The agency will release an official estimate of acreage March 29th.
Trump | Oval Office Remarks February 19, 2019
Q How confident are you that it will be finished by March 1? Or are you considering extending that deadline?
THE PRESIDENT: Well, they are very complex talks. They’re going very well. We’re asking for everything that anybody has ever even suggested. These are not just, you know, “let’s sell corn or let’s do this.” It’s going to be selling corn but a lot of it – a lot more than anyone thought possible. And I think the talks are going very well – with China, you’re referring to?
Q Yes.
THE PRESIDENT: And the talks are going very well.
Our group just came back and now they’re coming here. I can’t tell you exactly about timing, but the date is not a magical date. A lot of things can happen.
The real question will be: Will we raise the tariffs? Because they automatically kick in to 25 percent as of – on $200 billion worth of goods that they send. So I know that China would like not for that to happen. So I think they’re trying to move fast so that doesn’t happen. But it’s – we’ll see what happens.
I can only say that the talks with China on trade have gone very, very well. In the meantime, our economy is very strong. We’re doing well.
I don’t know if you noticed, but deficits seem to be coming down. And last month it was reported, and everybody was surprised, but I wasn’t surprised. We’re taking in a lot of money coming into our Treasury from tariffs and various things, including the steel dumping. And our steel companies are doing really well. Aluminum companies also. So we’re very happy about that.
I think that it’s – they’ll be coming very shortly. They’re going to have very detailed discussions on subjects that have never really been even discussed by people that sat in this chair and they should have been. Very important subjects. And I think we’re doing very well. Okay?
Rivian Automotive LLC expects to build an electric plug-in pickup truck and SUV starting in 2020. Todd Gleason talks with Michael McHale about the startup company and its plans to produce the vehicles in Normal, Illinois. They also take up the impact electric vehicles are having on the automotive industry and potentially ethanol made from corn.
The fourth annual backyard maple syrup production workshop will be held on Saturday, February 2, 2019 from 10am–3pm at the Dixon Springs Agricultural Center, located at 354 State Highway 145 N, Simpson, IL 62985. This program is free and open to the public.
We are offering an expanded program this year! From 10-noon come learn the basics and see firsthand the entire process of backyard maple syrup production. Following a free lunch at noon, we will have maple syrup experts on hand to discuss scaling up production and advanced techniques and demonstrating equipment from 1pm to 3pm.
During the morning session, the University of Illinois Extension will provide some activities for kids, including taste testing of real maple syrup!
Program Schedule
* 10:00am to Noon - Maple syrup basics, kids activities, field tour
* Noon to 1:00pm - Lunch (provided)
* 1:00pm to 3:00 pm - Advanced techniques and equipment demo
You can choose to come to the morning session, the afternoon session or both! Register by January 30th.
For more information: Chris Evans cwevans@illinois.edu , 618–695–3383
University of Illinois College of Agricultural, Consumer and Environmental Sciences United States Department of Agriculture. Local Extension Councils Cooperating provides equal opportunities in programming and employment.
If you need a reasonable accommodation to participate in this program, contact Dixon Springs Ag Center at 618–695–2441.
The January USDA reports have been delayed until further notice because of the government shutdown. It is expected once these numbers are released the changes in the national yields for corn and soybeans could be positive for price.
The last time USDA updated corn and soybean yields was in the month of November. Both crops saw a drop in predicted yield for the 2018 harvest. This drop has been since complicated by harvest problems. Todd Hubbs from the University of Illinois says history can sometimes be a guide to how the January Crop Production report might change. More often than not when the yields from October to November go down, the U of I commodities specialist says they drop again in January, “And what you see is when you see a yield change from November to October that is negative, we tend to see a similar change from January to November. Now it doesn’t always hold, but if that were to materialize we probably see a corn number around 177.2 bushels to the acre. I think it might be a little bit higher than that, but even if it is if we lose half to one bushel out of the current projection of 178.9, then that is really supportive for corn prices moving forward.”
Hubbs says a similar pattern holds for soybean yields. On average he says that’s been about a quarter of a bushel per acre… a little better than that actually… and if it came to fruition this year it would put the 2018 soybean yield at 51.8 bushels to the acre. That would clearly be supportive to price says Hubbs, even though the trade issues with China are continuing, “We could also see some acreage come out of both corn and soybeans as harvest was really tough in some places. Particularly out in Kansas and the southern plains. This has more implications for winter wheat seedings than it does for anything else. Right now, by my projections, I think winter wheat acreage will be down by one-point-five percent from last year’s 32.5 million acres. This may have implications for both corn and soybean acreage in the southern plains as we move into 2019 and think about what kind of acreage we will have.”
The implication being a potential increase in corn or soybean acreage in that area. USDA says it will announce the date for the release of the January reports once the government shutdown has ended.
The January USDA reports have been delayed until further notice because of the government shutdown. It is expected once these numbers are released the changes in the national yields for corn and soybeans could be positive for price.
The last time USDA updated corn and soybean yields was in the month of November. Both crops saw a drop in predicted yield for the 2018 harvest. This drop has been since complicated by harvest problems. Todd Hubbs from the University of Illinois says history can sometimes be a guide to how the January Crop Production report might change. More often than not when the yields from October to November go down, the U of I commodities specialist says they drop again in January, “And what you see is when you see a yield change from November to October that is negative, we tend to see similar change from January to November. Now it doesn’t always hold, but if that were to materialize we probably see a corn number around 177.2 bushels to the acre. I think it might be a little bit higher than that, but even if it is if we lose half to one bushel out of the current projection of 178.9, then that is really supportive for corn prices moving forward.”
Hubbs says a similar pattern holds for soybean yields. On-average he says that’s been about a quarter of a bushel per acre… a little better than that actually… and if it came to fruition this year it would put the 2018 soybean yield at 51.8 bushels to the acre. That would clearly be supportive to price says Hubbs even though the trade issues with China are continuing, “We could also see some acreage come out of both corn and soybeans as harvest was really tough in some places. Particularly out in Kansas and the southern plains. This has more implications for winter wheat seedings than it does for anything else. Right now, by my projections I think winter wheat acreage will be down by one-point-five percent from last year’s 32.5 million acres. This may have implications for both corn and soybean acreage in the southern plains as we move into 2019 and think about what kind of acreage we will have.”
The implication being a potential increase in corn or soybean acreage in that area. USDA says it will announce the date for the release of the January reports once the government shutdown has ended.
Last Monday Minnesota Congressman Collin Peterson held a press conference in Moorhead. There in his home state, Mr. Peterson spent twenty-four minutes detailing the Farm Bill conference agreement. University of Illinois Agricultural Policy Specialist Jonathan Coppess listened to the discussion and has this review with farm broadcaster Todd Gleason.
Each Friday over the past three weeks December corn futures closed lower. These lower weekly thresholds have come despite a very good export pace.
USDA projects this marketing year U.S. corn exports will top two-point-four-billion bushels. So far that doesn’t look too bad says University of Illinois Agricultural Economist Todd Hubbs, “We are definitely on pace. We’ll above last year’s pace, but everybody needs to remember we got off to a sluggish start last year and it really picked up in the second-half of the marketing year. We’ve seen a little bit of weakness recently, but we are still within the 2.45 billion bushels in my opinion.”
Hubbs is okay with USDA’s corn-used-to-produce ethanol figure, too. Although he says that’ll depend on ethanol exports as plant margins are really tight. He’s hopeful the corn-used-for-feed number will look better in January. That’ll depend a lot on the December Grain Stocks report. Still he says, “Right now, from the November projections, we are on track. There is a lot of uncertainty left in that. But when we look at the corn prices over the last few weeks, it is definitely related to the soybean prices and the bearishness in the (crude) oil market. I think both of those things are holding down corn prices.”
Not that if those two items were solved corn would rally substantially. It would come up, but still be capped by the available supply and some thought that USDA’s export target is a bit robust. Todd Hubbs thinks of it this way. The market has a done a good job of front loading U.S. corn exports and it is very unlikely the second half of the 2018/19 marketing year will be a repeat of last season’s stellar pace.
