Pay attention to some fundamental changes going on in acreage plans, or you could make a management boner.
In the January issue of the Soybean Digest, I made projections suggesting a big increase in U.S. planted soybean acreage for 1998. A number of factors have changed in the last 60 days, and at NorthStar we're making some significant changes in our planted-acreage projections.
USDA will make its initial projections on March 31, when its Prospective Planting and Grain Stocks Report is released.
The following factors have changed and will impact planted acreage in 1998:
* The Conservation Reserve Program announcement in late January showed 5.9 million acres going back into the program, so only 2 million acres will be shifted to crop production this year.
* Early indications are that sorghum acreage could jump by 1-2 million acres, to 11-12 million, compared to just 10 million acres last year.
* Early seed sales in the Midwest suggest more corn and fewer soybeans. Our projections are now for 82.2 million acres of corn.
When you look at the total crop acres expected to be planted in 1998 and allow for more corn and sorghum, odds are good that the U.S. will end up with soybean acreage unchanged or lower than in 1997.
That's a big fundamental difference from my projection in the January issue.
Keep in mind that a 2-million-acre change in plantings will swing total production up or down by 75-80 million bushels, while a 2-bu/acre change in national yield will make a swing of 130-140 million bushels.
So, as always, Mother Nature will have a huge impact on production and price outlook.