Economic Tidbits

Farmers Start Your Tractors

Spring is here, planting is in the air, and the USDA National Agriculture Statistics Service (NASS) last week readied the soil with the release of its annual prospective plantings report. The report projects crop plantings based on farmer surveys conducted during the first two weeks of March. USDA-NASS projects Nebraska farmers will plant 19.7 million acres to principal crops, down slightly from last year. This includes 9.7 million acres of corn, off 2.0 percent from last year, and 5.7 million acres of soybeans, up 5.0 percent. If realized, it would be the fewest acres planted to corn by Nebraska farmers since 2018 and equal the record number of acres in soybeans set in 2017 and 2018. The record number of acres planted to corn is 10.2 million acres in 2020 (Figure 1).

Figure 1. Acres Planted to Corn & Soybeans in Nebraska

Source: NEFB graphic based on USDA-NASS data (2022 is estimate)

USDA-NASS projects 89.5 million acres of corn will be planted nationwide, down 4 percent, or 3.87 million acres, and 91.0 million acres of soybeans, up 4 percent, or 3.76 million acres. The soybean acres, if realized, would be a record. Both projections are considerably different from average trade guesses, 92 million acres for corn and 88.7 million acres for soybeans. While there was some expectation of a shift from corn to soybean due to higher fertilizer costs, the projected magnitude of the shift surprised most market participants and observers. For Nebraska, even with higher input prices, corn generally pencils out as being more profitable. Some market observers speculate the bigger shift might reflect farmers’ concerns with having a reliable fertilizer supply.

Table 1 lists USDA projections for other Nebraska crops. Grain sorghum acres are expected to see the largest percentage change, down 14 percent from last year to 275,000 acres. However, the decline comes on the heels of a 64 percent increase last year. Acres planted to sunflowers and dry beans are also projected to fall, while those planted to sugar beets are projected to be slightly higher. Wheat acres in the state are up 80,000 acres compared to last year, a growth of 8 percent. Nebraska’s harvested hay crop, often under-appreciated for its size, is pegged at 2.55 million acres, about the same as last year. Nebraska is the fifth-largest state for hay acres harvested. Only Kansas, Texas, Missouri, and Oklahoma are projected to harvest more hay acres this year.

Table 1. Estimated Planted Acres in 2022

Source: USDA National Agricultural Statistics Service

Scott Irwin, an agricultural economist at the University of Illinois, says the USDA projections have proven to be unbiased over time and predicting revisions following planting season is difficult. The USDA report represents the best available market information at present. And until farmers get the crops in the ground, these will be the projections the market will use in moving forward. Farmers start your tractors. The green flag is about to wave.

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