Farm Progress

Each spring, US farmers decide how much land they will devote to each of the major agricultural commodities. The process, which shapes crop prices for the season, is known as the acreage battle or – as Cargill traders joke – the fight for dirt.The farmers’ choice matters beyond US borders. Because the country’s farmers export half the world’s corn and a third of the world’s soybeans, changes in acreage and, hence, in output have a huge impact on global agricultural commodities prices.

December 16, 2010

1 Min Read

From the Financial Times:

Each spring, U.S. farmers decide how much land they will devote to each of the major agricultural commodities.

The farmers’ choice matters beyond US borders. Because the country’s farmers export half the world’s corn and a third of the world’s soybeans, changes in acreage ... have a huge impact on global agricultural commodities prices.

Amid multi-year high prices, farmers face the mother of all battles for acres in 2011.

Who is going to win? At current forward prices, corn should see a large gain in acres – and prices should drop – while soybeans are likely to lose arable land, and prices, conversely, are likely to rise.

Please see Commodities daily: Mother of acreage battles (registration required by Financial Times)

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