As the calendar turned to 2025, plans were well underway for the new growing season. Ben Brown is an agricultural economist at the University of Missouri, and he’s predicting farmers will likely add to their corn acreage in 2025.
“My expectation is I do think that the market’s going to incentivize additional corn acres, and so whether USDA makes that adjustment at the Outlook Meeting in February, or if they wait till May – well, I guess it would be the Prospective Plans report the end of March when they survey producers – but officially coming to the balance sheets in May. There are some timing aspects here, but certainly, I think we’re going to be in an environment where there are additional corn acres. I know it’s a long way out, and weather is just as volatile and fickle as markets are in a lot of cases, but you know, at least the weather pattern certainly suggests that it’s going to be a drier spring. That tends to hint at additional corn acreage as well.”
He talks about what producers should be doing right now, especially when it comes to dealing with old crop supplies.
“Yeah, even though we do have January soybean contracts for that old crop market, my sense is that – Of course, it plays out in terms of the trade, right? – there are more contracts on the March futures than there are in the January futures, and so, I do think that there probably are a couple of elevators across the country, and producers that are working with those elevators that are on January contracts, they’ll have to make some decisions very quickly about what they do with their product. However, it’s my kind of belief, and it’s playing out, at least in terms of the volumes here, that most producers are in a March futures contract or have an opportunity to where they’re pricing their local cash bids off the March futures. We’ve got a little bit more time, I guess is what I would say before a decision has to be made whether you want to pull the trigger or if you want to exercise options.”
There’s time for producers to make some decisions.
“Time can both be a negative and a positive, depending on what it causes. It can cause paralysis and decision-making to where people don’t want to pull the trigger or are undecided, and I would just simply say that, like right now, we’re in this very tactical environment to where if there are returns in futures markets to signify or justify storage, that’s an opportunity. If there’s not which, you know, it’s not like there’s a lot of carry in the soybean market. There is some, but it’s not like it’s a lot. We’re not making a whole lot of money by storing that problem, at least. My concern. I already hinted at it a little bit as like my bias is a little bit more bearish to the bean market here in the short term, and so whether they should sell out of those positions or not, that’s up to individual producers. It’s hard for me to see a whole lot of pricing opportunities here in the next couple of weeks.”