US farmers are likely to plant an additional 2 million acres of soyabeans this spring compared with 2005 due to the crop rotation cycle and the higher cost of planting corn amid rising energy prices, analysts said.
The analysts' expectations come ahead of the US Department of Agriculture's prospective plantings and quarterly March 1 stocks reports to be released on Friday.
The consensus among analysts is that USDA will project 2006 US soyabean plantings at 74.2 million acres, compared with the 72.1 million seeded last spring.
"I've got it up because of the increased expense from an energy standpoint for planting corn. Also, last year we had a fairly sizeable reduction in soyabean planting. So I think we'll see a partial recovery," said oilseed analyst Anne Frick of Prudential Securities.
Corn is dependent on nitrogen fertiliser made from natural gas to produce high yields, while soyabeans fix their own nitrogen and are less dependent on nitrogen fertiliser. US farmers rotate corn and soyabean plantings from one year to the next to maximise any fertiliser left in the soil and to reduce disease outbreaks.
US corn plantings in the spring of 2005 reached 81.8 million acres but are expected to fall to about 80.5 million this season, analysts said.
"As you shut those corn acres down, you put in a few beans because of a natural rotation. Also, you get a few more bean acres double cropped behind soft red wheat ... remember you've got some areas that are looking at as much as a 20 percent increase in acres" to SRW wheat, said Roy Huckabay, analyst with Chicago-based trade house The Linn Group.
Recent rains across Mississippi, Arkansas, Kentucky, Tennessee, and southern Illinois should improve outlooks for double-crop soyabeans. Mid-south farmers will harvest their soft red winter wheat crop in late June, then plant soyabeans that will be harvested in the fall.
"I think with bean prices as high as they are in the deferreds, it's giving you an opportunity to do some double cropping - just because of the big carries in the market," Huckabay said.
New-crop November soyabeans at the Chicago Board of Trade are trading at roughly a 15-cent per bushel premium to old-crop July this week. By Wednesday midday, July soya was unchanged at $5.94-1/2. "Everyone has the big acres plugged in. What doesn't go away is the large carryout forecast," said Dan Cekander, analyst with Fimat USA.
Analyst Joe Victor of Allendale Inc said: "The largest March 1 soyabean stocks in history should be staring us in the face on Friday. We're at 1.663 billion ... the three-year average is 1.163 - that's a 43 percent increase in soyabean stocks."
The average of analysts March 1 soya stocks estimates was 1.680 billion bushels, up from 1.381 billion a year ago.
"We're wading in soyabeans right now," Victor said.
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