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U.S. Farmers Plan to Cut Corn, Boost Soy, Wheat

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U.S. Farmers Plan to Cut Corn, Boost Soy, Wheat


U.S. Farmers Plan to Cut Corn, Boost Soy, Wheat

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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Farmers are looking to plant fewer acres of corn and more acres of soybeans and wheat. That news is especially interesting to commodity traders, but the USDA's highly anticipated Prospective Plantings Report has implications on and off the trading floor. Chicago Public Radio's Adriene Hill reports.

(Soundbite of trading floor)

ADRIENE HILL: Here on the agriculture trading floor at the Chicago Board of Trade, the USDA has released its planting report numbers. The room is filling up with traders waiting to act on those numbers, staring up at the price boards around them.

I talked to trader Matt Fink. He's been trading here since 1991. I ask him what he thinks about this report.

Mr. MATT FINK (Trader) Really right now it's 9:01, and I still have no bearing as to where the market's going to be. I'd say I don't - I think let it open and put your big-boy pants on, because it's going to be, it's going to be, it's going to be something. I don't know what it's going to be, but it's going to be something.

HILL: Fink has a plan that he hopes will make him some money today.

Mr. FINK: I'm going to stand back and let the market digest a little bit because it's going to be wild, there's going to be a lot of gyrations, be very cautious and just try to see if there's some kind of a trend that I can pick up, you know, during the day.

HILL: Plenty of other traders are raring to go when the market opens at 9:30.

(Soundbite of bell)

HILL: The USDA reports that farmers intend to plant 8 percent fewer acres of corn this year than last. In 2007, farmers planted the highest number of corn acres since World War II. There are a few reasons for the cutback, including concerns over high fertilizer costs and the need to rotate crops.

Farmers are also getting good prices for the other things they grow, and the USDA report reflects that. Soybean acreage is expected to be up 18 percent this year. That news sent soybean prices at the Board of Trade tumbling.

But Fink's trades are going well. By lunchtime he decides to call it a day, a successful day. He's made money with trades on corn, soy and rice. He won't say how much.

The planting report is a bit more of a mixed bag for those of us who aren't traders. Grain analyst and longtime trader Vic Lespinasse explains.

Mr. VIC LESPINASSE (Trader): It could mean somewhat lower prices at the grocery store, as far as, say, bread is concerned, and as far as salad oil, salad dressing is concerned, things like that. Things that are made from wheat and soybeans could be heading down a little bit.

HILL: If farmers plant the crops they plan to, there'll be more soybeans and wheat in the market. That pushes prices down. Corn is facing the opposite pressure. Fewer acres will mean more competition between corn for fuel and corn for food, and corn prices affect a lot of other food prices. Corn syrup is used in many processed foods, and for animals like pigs, chickens and cows, corn is a staple.

The USDA's report looks at other grains as well. Oat plantings are expected to fall, sorghum too, and barley acreage could grow this year, and that might affect the cost of Matt Fink's post-market beverage of choice: a cold beer.

(Soundbite of tavern)

HILL: We meet again at Billy Goat Tavern. The Cubs opener is on TV. He says he's shifting his attention from acres planted to Mother Nature.

Mr. FINK: Total weather, because of the volatility based on weather, because I cannot predict weather.

HILL: Now it's up to farmers to decide if and how they'll change their plans for the year. Since most of these crops aren't in the ground yet, the report could cause some farmers to rethink what they plant in their fields. For NPR News, I'm Adriene Hill in Chicago.

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