U.S. Corn-Seed Supply Sufficient for Planting, Industry Says
Farmers in the U.S., the world’s largest corn grower and exporter, have enough seeds to plant this year, according to the Iowa Corn Promotion Board, the U.S. Department of Agriculture and Monsanto Co. (MON)
“We have not heard of anything that shows there’s any kind of seed-supply problem at all,” Kevin Rempp, the Iowa Corn Promotion Board’s vice chairman, said today in a telephone interview from Johnston, Iowa. The state is the nation’s largest producer. “The only way acreage will not be planted will be weather issues.”
An adequate supply of seed may help farmers increase acreage in the U.S., which accounts for about 44 percent of the world’s corn trade. The Wall Street Journal reported earlier today that farmers were facing a shortage of seeds. Demand for U.S. grain may increase as dry weather caused by La Nina threatens harvests in Argentina, the second-largest exporter, and Brazil, the fourth-biggest.
Corn rallied 6.3 percent in Chicago last month on concern that South American supplies may decline. Hot, dry weather reduced U.S. corn production to the lowest in three years in 2011, helping the grain post a third annual advance, while prices fell for wheat and soybeans. Corn futures for March delivery dropped 2.2 percent to $6.4425 a bushel at 10:54 a.m. on the Chicago Board of Trade.
Monsanto, DuPont
Hugh Grant, the chief executive officer of Monsanto, the world’s largest seed company, said today on a conference call that the St. Louis-based company is able to supply U.S. farmers with enough corn seed. Monsanto reported that first-quarter earnings exceeded estimates as Latin American farmers grew more genetically-enhanced corn. The company said U.S. orders are ahead of last year. DuPont Co.’s (DD) Pioneer Hi-Bred seed unit also said today that it has enough supply to meet demand.
Richard Guse, 51, who farms with his brother in Waseca, Minnesota, said he was unable to buy all the top-performing seed varieties he wanted from Monsanto, so he will switch to more Pioneer seed.
“Some farmers won’t be able to buy their first choice, but there would be no statistically significant impact on corn seedings or on corn yields,” Bill Tierney, the chief economist at Chicago-based AgResource Co., said in an e-mail today. “I also recall how many times I’ve heard about this possibly being a problem. It never materialized.”
Planting Increase
U.S. plantings may reach about 94 million acres (38 million hectares) this spring, Morgan Stanley said in a report dated yesterday, citing an estimate from Michael Cordonnier, the president of forecaster Soybean & Corn Advisor Inc. Farmers planted 91.9 million acres last year, according to the USDA.
The Wall Street Journal said that, by some estimates, U.S. production of corn seed was down 25 percent to 50 percent before this planting season and that output was hurt by drought in the Midwest and Great Plains last year.
“While some varieties may not be available, we have no evidence to suggest that planted acres will be constrained by a ‘shortage’ of seed,” USDA Chief Economist Joseph Glauber said today. “Current indications suggest that corn producers will expand planted acres this spring.”
To contact the reporters on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net; Jeff Wilson in Chicago at jwilson29@bloomberg.net
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
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