The area figures for grains in the United States are causing a stir. In addition, China reports that it again wants to buy extra soybeans from the United States. What's going on in the grain market in the United States?
Last week, the United States Department of Agriculture (USDA) released new acreage figures. According to the ministry, approximately 92% of the soybean area sown, which means that sowing is only 7% behind the 5-year average. This means that a significant amount of catching up has been made, because by mid-June only 77% of the area had been sown.
However, the USDA has announced that the soy area will probably decrease by 10%. The wheat area would decrease by 4,1%, while the corn area would increase by 3%. However, various analysts state that the figures on the soy area are incorrect and that the decline is less significant. Moreover, they do not understand the growth of the corn area.
Needs a lot of insurance money
Those analysts' thoughts are supported by other figures from the USDA. It shows that potentially $1 billion in insurance money will go to farmers, mainly because sowing could not be done on time. The Ministry of Agriculture advises to sow green manures on the unsown hectares. This indicates that more hectares have not been sown than the USDA poll shows.
US President Donald Trump also says that China will again buy more soybeans from the United States. While this is initially positive for American farmers, it is unlikely that exports will return to normal levels. On the other hand, Trump's words are supported by the fact that China has purchased about 544.000 tons of soybeans. That is the largest amount since March.