April 27 (Bloomberg) -- Corn fell to the lowest price in almost three weeks on speculation that rapid planting and favorable growing conditions will aid early development and boost yields in the U.S., the world’s largest producer and exporter.
About 50 percent of the crop was seeded as of April 25, compared with 19 percent a week earlier and 20 percent last year, the U.S. Department of Agriculture said yesterday. The pace is the fastest since the department began collecting national data in 1975, said Julie Schmidt, a USDA statistician in Washington.
“The rapid pace increases the odds for farmers to plant more acres with corn,” said Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana. “The early planting will boost the chances for above-average yields.”
Corn futures for July delivery fell 5.75 cents, or 1.6 percent, to $3.5375 a bushel on the Chicago Board of Trade, the third straight decline. Earlier, the price dropped to $3.515, the lowest since April 7.
Corn has fallen 15 percent this year in part because the USDA forecasts a 13 percent increase in combined production from Brazil and Argentina, the two biggest exporters after the U.S.
U.S. farmers may increase planting by 2.7 percent this year to 88.798 million acres (35.9 million hectares), enticed by the prospect of improved returns and the availability of acreage normally sown with winter wheat, the USDA said March 31. That would be the second-largest seeded area for corn seeded since 1946, behind only the 2007 crop, government data show.
The record pace by farmers may lead to an increase of more than 1 million acres from the USDA’s March planting estimate, Gerlach said.
Since 1990, there have been only five years when corn planting was more than 58 percent complete by the second week in May. During those years, the average increase in corn plantings from the March estimate to the June estimate by USDA was 1.07 million acres, data from the USDA show.
“Corn-planting progress is incredible, and that means farmers are going plant more corn” than the USDA estimated, Gerlach said. “People will be surprised” by how many acres will be planted on ground that was left idle by rains the past two years and how much is shifted from other crops, Gerlach said.
Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at $31.8 billion, government figures show.
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