DES MOINES, Iowa (AP) — Farmers are expected to plant a record number of soybean acres this year, but fewer acres of corn as profit potential for the grain remains low due to slumping prices, the U.S. Department of Agriculture said Tuesday in its first report of the new crop season.
The USDA surveyed 84,000 farmers in March to assess their planting intentions for corn, soybeans and other major crops.
Farmers indicated plans to plant a record high 84.6 million acres in soybeans, up 1 percent from last year. But corn acres will fall for the third consecutive year to 89.2 million acres, down 2 percent from last year and the fewest since 2010.
More farmers are favoring soybeans because they cost less to grow and prices farmers receive for soybeans haven't fallen as quickly as corn. Soybeans also can withstand broader weather variations. For example, in Iowa, the nation's leading corn state, the grain costs about $4.23 a bushel to grow when land, machinery and labor costs are factored in, but gets less than $4 a bushel when sold.
Corn can still be profitable for farmers who own their own land and don't have high overhead costs — particularly in the main corn belt states of Iowa and Illinois where per-acre yields can be high. Many farmers outside of those states, however, are betting they can make more money on soybeans.
North Dakota farmers will cut corn to 2.7 million acres, a significant reduction from the peak of 3.9 million acres in 2013 when corn prices were higher. Soybeans acres in North Dakota will grow to 5.8 million acres from 4.7 million in 2013.
"People that are starting to grow beans have found that in a good year they can produce above average beans and that's worth planting to get the chance to get an excellent yield," according to Craig Olson, who farms 3,000 acres with family members in southeast North Dakota. "The upside potential is way higher and the risk is lower for soybeans."