U.S. corn plantings are expected to total 94 million acres this year, up 3.8 percent from 2024, according to the USDA’s first outlook for 2025 on Thursday.
If realized, that would be the second-highest acreage behind the 2023 record of 94.6 million acres. There is a heavy bias toward corn acres this year due to better profitability compared to other crops, such as soybeans and cotton. A Trader PhD survey conducted this past week shared a similar bias toward corn.
Soybean acreage is forecast at 84 million acres, down 3.5 percent from last season. Meanwhile, wheat acres are expected to increase to 47 million, an increase of 900,000 from the previous season.
Beyond the headline numbers, the USDA’s outlook highlighted a more burdensome supply situation for the corn market, which could have been behind the strong selloff in futures following the acreage release.
Strong ethanol production and corn exports helped chew through higher corn supplies in the past two marketing years. However, with demand expected to level off (per Thursday’s USDA projections), 2025/26 corn endings stocks could rise back toward 2 billion bushels, a level higher demand fended off this past year.
The stocks-to-use ratio for the new crop season is currently pegged at 12.9 percent, the highest since the 2019/20 marketing year.
The greatest uncertainty for the corn market is volatile trade relations with neighbors. A trade dispute with Canada could disrupt ethanol exports, which have been a primary driver of ethanol demand. Additionally, Mexico has accounted for nearly 40 percent of corn exports and commitments for the current marketing year.
Multiple delays in tariff implementation against USMCA countries have helped subside worries. Killing the primary factor that sent the corn market rallying this winter could mean further pain for row crop markets.
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