UPDATED: With more market data, insight from Bryce Knorr.

U.S. crop prices sped higher near midday on Tuesday after USDA lowered its numbers for the 2015 corn and soybean harvests and greatly reduced winter wheat planted acreage.

Corn harvest is now at 13.6 billion bushels. While that is up slightly from Farm Futures forecast of 13.57 billion, it is down from USDA’s December number of 13.654 billion and a little less than the average in a wire report survey.

The soybean harvest was put at 3.93 billion, a little less than Farm Futures’ 3.986 billion and the trade average of 3.981 billion. USDA’s latest number nearly matches the 2014 harvest.

Tuesday's report trimmed U.S. corn and soybean harvests offering friendly news to traders.

“USDA’s lower soybean production estimate was the biggest surprise of the report, with a cut of 51 million bushels due to lower acres and yields, and supporting the market’s advance,” said Bryce Knorr, Farm Futures senior grain market analyst. “I’m in agreement with the agency’s cut to exports, and we have to watch crush too because margins are deteriorating and Argentina may get more aggressive with sales.”

USDA lowered soybean exports to 1.69 billion from 1.715 billion.

USDA’s winter wheat planted acreage of 36.61 million came in well below Farm Futures 39.46 million and the average of analysts in wire surveys of 39.32 million. Hard red winter acreage came in at 26.5 million, soft red at 6.72 million and white at 3.43 million, versus the respective trade averages of 28.81 million, 7.144 million and 3.366 million. 

“Heavy rain kept growers in the South from planting, despite gains in Ohio, Wisconsin, Michigan and Indiana. On the Plains low prices appear to have discouraged growers, as they reduced hard red ground everywhere,” Knorr said of the wheat acreage.

USDA’s corn crop of 13.6 billion was close to forecasts by Farm Futures and the trade average, both of which expected a reduction from USDA’s December number.

“USDA reduced demand, with a small reduction in domestic usage and a cut to exports. While the export reduction was in line with my estimates, demand for ethanol and livestock feed still look better than the agency forecasts,” said Knorr. “But improving the bottom line in these USDA reports will take time to play out. That will leave corn a follower.”

USDA trimmed corn exports to 1.7 billion bushels from its previous 1.75 billion.  The previous year’s exports were 1.864 billion.

Ending stocks for the 2015 harvest were raised for corn and wheat, to 1.802 billion and 941 million, respectively, and topped trade forecasts. The stocks for soybeans went to 440 million from 465 million.

Near midday March soft red winter wheat futures were about 13 cents higher at $4.82-1/4, March soybeans were up 15-1/4 at $8.76-1/2 and March corn was up 7-1/2 at $3.59-1/4.

Check out the report numbers in depth