USDA Pegs Total U.S. Wheat Planted Area Down For 2014/15

By Casey Chumrau, USW Market Analyst

Farmers and customers alike eagerly awaited the annual USDA Prospective Plantings report released on March 31 because information in the report adds perspective to wheat market factors in the final months of the marketing year and can influence prices moving into the new crop. This year, USDA released two reports on the same day: a bearish stocks report for wheat that outweighed a slightly bullish plantings report. As a result, all three U.S. wheat futures markets closed lower in both nearby and deferred months.

USDA bases Prospective Plantings report data on producer surveys. This year, USDA forecasted that total U.S. wheat planted area for the 2014 harvest would fall 1 percent from last year to 22.6 million hectares (55.8 million acres). If realized, it would equal the average planted area for the past five years.

The report also provided the first indication of expected spring wheat and durum acres. USDA projected a 4 percent increase in total spring planted area at 4.8 million hectares (12.0 million acres). The report expected the majority of the spring planted area, 4.52 million hectares (11.3 million acres), would be planted to hard red spring (HRS) wheat. If realized, it would be a 3 percent increase in HRS acres but 6 percent below the five-year average of 4.8 million hectares (11.9 million acres). The forecast was on par with expectations, according to Erica Olson, marketing specialist with the North Dakota Wheat Commission. She attributes the increased acreage to higher wheat prices and lower corn prices in the past few months, which should encourage many farmers to plant more wheat and less corn. In addition, farmers will likely increase crop rotations to spring wheat this year because wet weather prevented quite a bit of spring wheat planting last year.

Farmers told USDA they intend to plant 0.72 million hectares (1.8 million acres) to durum this year, up 22 percent from last year but still 11 percent below the five-year average. According to Olson, stagnant northern durum prices are keeping planted area below historical levels. Durum is the smallest U.S. wheat class by volume and large production in the north can greatly affect prices. A huge Canadian durum crop last year suppressed U.S. durum export demand and will further reduce durum seeding this year.

The plantings report also provided an update on winter wheat acreage. USDA estimates 16.8 million hectares (42.0 million acres) were planted to winter wheat, which is down 3 percent from last year but up slightly from the previous estimate. Of that, the report said 12.1 million hectares (30.2 million acres) were planted to hard red winter (HRW) wheat, the largest U.S. wheat class by volume. If accurate, 2014 planted area would be 2 percent higher than both last year and the five-year average. Currently, extremely dry conditions through the HRW growing area are downgrading production prospects. Conditions diminished during the dormant winter months and moisture is badly needed now as the crop reemerges. Still, according to the U.S. Drought Monitor, the situation is not as dire as it was at this time last year.

The report indicated that farmers seeded an estimated 3.38 million hectares (8.43 million winter acres) to soft red winter (SRW) wheat for 2014/15. That would be down from last year when SRW planted area hit 4.0 million hectares (10.0 million acres) for only the third time in 15 years. If realized, that planted area would still be 5 percent greater than the five-year average.

The remaining 1.62 million hectares (4.05 million acres) are dedicated to white wheat, including 1.34 million hectares (3.35 million acres) of soft white (SW) and hard white (HW) winter wheat. If realized, planted area would be down from 1.66 million hectares (4.16 million acres) last year and 3 percent below the five-year average.

Source : uswheat.org