Planting Progress Report What Does it Mean?
Every Monday afternoon in the spring the USDA releases the Planting Progress Report. Gordy with Chiodo Commodities found out the planting progress does not mean what traders assume it does in terms of acres planted. The end of March the USDA releases the Intended Acres Report. This year the USDA projected U.S. farmers would plant 92.4 million acres of corn.
Monday afternoon the USDA reported that farmers had 83 percent of the intended corn acres planted as of last Sunday June 9, 2019. So, doing the math 83 percent of 92.4 equals 76.7. Traders assumed that 76.7 million acres of corn was planted and there were almost 16 million acres of corn that was not planted yet. Gordy and I have talked many times on the air about how the USDA uses the prevented plant acres in the Planting Progress Report?
Gordy went to the USDA - NASS web site that published the Planting Progress Report. There was a name and number of a contact person with the USDA in Washington D.C. at the end of the report. Gordy called and left a message about his question. Later in the day she called him back to answer his question! She said the USDA was getting a lot of calls and questions about how they use the prevented plant acres in the report.
Here is how the USDA person in charge of the report described how they do it. Assume you are a farmer that intended to plant 1,000 acres of corn. Two weeks ago you had 500 acres planted so you were 50 percent planted. Then it rained for two weeks and the date when you could take the prevented plant option has passed. It is well into June, and the fields are so wet it will take days of nice weather before they are dry enough to plant.
So, the farmer decides to take the prevented plant. Here is the question, does the USDA - NASS continue to use the 50 percent planted in the weekly reports, or because the farmer is not going to plant any more corn is he 100 percent planted? Gordy found out the USDA will use 100 percent. The farmer is done planting corn even though he only got half of his corn planted.
The point is a lot less corn was likely planted than traders are assuming using the Planting Progress numbers. Eventually we will see how many acres were planted but not until the end of this month when the USDA releases the Acres Report.