U.S. crop-planting outlook comes as prices climb
Economists and investors worldwide will be paying extra close attention Thursday to a U.S. crop-planting forecast, looking for signs of relief from the tight food and fiber supplies now driving up prices from the grocery aisle to the clothes rack.
The U.S. Department of Agriculture report will show how many acres U.S. farmers intend to devote to corn, wheat, soybeans and cotton, commodities whose supply and price has future implications for apparel makers, food companies, meat producers and agriculture suppliers.
The “Prospective Plantings” report, released March 31 every year, is due out at 8:30 a.m. Eastern Thursday. The outlook will likely impact near-term trading in the commodities market until traders see how much crop farmers actually put in the soil this spring.
The report comes as agricultural commodities have soared over the last 12 months, led by an 82% pop in corn futures prices and a 142% jump in cotton. Along with rising energy costs, this has prompted many food and clothing companies to raise prices this year even as consumer spending is not back to pre-recession levels.
The most recent USDA forecast calls for U.S. farmers to plant 240 million acres of corn, soybeans, wheat and cotton, a 10% increase over 2010.
“Bottom line is that this will not be enough acres,” said John Sanow, an agricultural market analyst at TelventDTN. “What we have in front of us is the most interesting and dynamic acreage battles in history."...MORE