U. S. farmers ready for risks to increase corn consumption
2023.02.06 07:28
U. S. farmers ready for risks to increase corn consumption
By Kristina Sobol
Budrigannews.com – After a late-season drought ruined the grain harvest last year and brought corn supplies to a near-decade low, U.S. farmers plan to increase corn acreage in 2023 in the hopes of lowering fertilizer costs.
Even as doubts grew regarding demand and price increases for soybeans outpaced corn in the latter part of last year, plans were made for the upcoming season. However, farmer interviews and early acreage forecasts demonstrate that farmers’ faith in the largest U.S. crop has not diminished.
Prices for the staple that is used in fuel and animal feed have come down after soaring to a 10-year high when Russia invaded major corn producer Ukraine a year ago. However, a large crop from the world’s largest exporter could further ease prices for the staple.
Despite the fact that corn typically requires a more proactive management style and a greater financial investment than the No. 2 crop, hopes were raised in the second half of 2022 when the cost of key inputs like fertilizer fell. Soybeans are the second cash crop grown in the United States.
Brandon Hunnicutt, who farms 2,300 acres with his father and brother near Giltner, Nebraska, stated, “We are going to be heavy corn and probably the heaviest on corn we have been in a long time.”
According to Hunnicutt, the 2022 harvest budget for his farm’s 2023 crops calls for corn to take up roughly 90% of those acres. This is in contrast to roughly 55% in 2022.
Hunnicutt said that one of the main reasons to buy a lot of corn in 2023 is how reliable corn yields are.
He stated, “On corn, it is a little more scientific.” “Well, I guess we will spray a fungicide and see if it works on soybeans,”
S&P Global (NYSE) analysts According to Commodity Insights, U.S. farmers will plant 90.5 million acres of corn in 2023, which is 2.2% more than the previous year. They will also plant 0.6% more soybeans, which is less than other early forecasts.
Soybeans and corn are used by farmers in the United States to keep the soil healthy. When fertilizer prices spiked last year, many farmers chose soybeans over corn for the majority of those fields.
Ohio farmer Scott Metzger stated, “It would take something pretty monumental to switch a bunch of acres around.”
However, once harvest begins in September, the corn bushels may struggle to find a home.
According to data from the U.S. Agriculture Department, exporters have booked sales of just 24.038 million tonnes of American corn since the harvest last year, which is a decrease of 43% from the previous year.
The most recent corn export forecast for the entire year was released by the government in January: 48.9 million tonnes, or 19.8 percent less than the initial export forecast for May 2022.
Domestically, corn consumption in the United States is forecast to reach a seven-year low of 304.561 million tonnes in the 2022/23 marketing year, a decrease of 4% from the previous year. That was largely because there was less demand for feed as commercial flocks were ravaged by an avian flu outbreak and the U.S. beef cattle herd shrank to its lowest level since 1962.
According to recent data from the U.S. Agriculture Department, farmers were forced to abandon the highest percentage of their corn acreage in the past ten years following a drought in August. The weather this winter hasn’t done much to give the crop the moisture it needs in the coming growing season from the soil.
Farmers were hopeful that prices would rise in the coming months as a result of last year’s harvest shortfall, which saw corn supplies fall to their lowest level since 2013.
Ellen Rahn, a farmer in Illinois, intends to grow corn on approximately 75% of her 1,600 acres. After the drought of 2012 ruined harvest across the Midwest, she followed a similar strategy of increasing corn acres, lowering stocks to their lowest level in nine years and supporting prices for the 2013 crop.
Rahn stated, “We are in a good part of the world… where we are typically guaranteed decent yields.”
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