Abandoned acres could return
BLOOMINGTON – High insurance guarantees paired with high grain prices could bring some abandoned acres back into production.
Dale Durchholz of Grain Cycles said from 2014, we have lost about 10 million total acres devoted to all crops which makes him question if growers are really going to leave that land idle this year.
“The bean crop insurance guarantee was a buck above the prior record,” Durchholz told The Central Illinois Farm Network on Friday.
Last year, producers saw higher crop insurance guarantees but nothing like what we’ve had this year.
We get the first look at acreage numbers for the year on Thursday in the USDA planting intentions report. This information is always a big deal and we will also receive quarterly stocks information on corn, wheat and soybeans.
“I am a little fearful that the numbers could come in a little bit above what the trade is looking for,” notes Durchholz.
As long as the war is happening in Ukraine with some of the other associated issues, Durchholz said people are probably not going to be real comfortable going home with either a big short or a big long position.
Durchholz is keeping a close eye on two particular issues including crude oil and wheat. The two are tied into the problems in Russia and Ukraine.
“Beyond that it’s a matter of keeping up with fed policy.”
The focus now turns to what the Fed will do, especially with the inflation issues we are currently experiencing.
For more information, follow Durchholz on Twitter @graincycles or e-mail firstname.lastname@example.org.