Thread by @ScottIrwinUI

1. Implications of FSA Sep acreage totals for corn and soybeans planted acreage. I am simply updating tables found in this recent #FDD article: farmdocdaily.illinois.edu/2020/08/using-…

2. Given the reported FSA Sep 1 totals, have to make an assumption about the completeness of reporting and % of acres enrolled in FSA programs. The latter is very stable over time so pretty easy. The kicker is the completeness of reporting. We knew it was way behind in Aug.

3. I make two assumptions about completeness of FSA reporting. In this first table I assume the reporting % for this Sep is the historical Aug avg. Just sayin a month behind.

4. If this is the right reporting %, then corn and soybean planted acreage this year is a million acres less than NASS June, with corn off 803k and soybeans off by 241k.

5. Next I assume that the Sep reporting % caught back up to the historical avg for Sep. If that is correct then NASS is too high by 2.25 million acres on corn + beans. Breakdown is 1.4 million too high on corn and 850 thousand too high on soybeans.

6. What does all this mean? Tells me that NASS planted acreage total for corn and soybeans is likely to come down another 1-2 million acres. Some of that will come in October but may not see the full adjustment until final estimates in January.

7. Remember that NASS adjustments based on FSA data are on top any derecho acreage adjustments. Had to get planted to get blown down!

8. If I have to choose, I will be conservative and say planted acreage for corn will come down a minimum of 850,000 acres and beans will come down a minimum of 300,000 acres.

9. Have to keep in mind the key role that reporting % plays in this analysis. If my reporting assumptions are too high then my acreage declines are too big. This table shows that Sep reporting rates of 98.2% on corn and 98.7% on soybeans exactly reconciles FSA and NASS acres.

10. Pretty sure any remaining uncertainty about FSA reporting rates will be resolved by October. At this point, I am confident that some kind of planted acreage reductions for corn and soybeans by NASS are coming in October.

2. Now you might ask: How did the total US crop acreage not decline in 2020 with the low crop prices? I will give you one guess. That's what tens of billions of $$ of gov't payments does for the crop sector.

3. Next up a different way of looking at corn and soybean planted acreage that does not rely on assumptions about FSA reporting rates. Table below shows total corn and soybean planted acreage and PP acres. One of my favorite tables in recent years.

4. Basic idea is that there is fairly stable total of corn and soybean planted acreage from year to year. Then check if allocations for 2020 make sense in terms of adding up. Grand totals from 2016-2019 only vary from a low of 178,7 to 181.7 million acres.

5. Now that we have a near census of PP acres, lets add the NASS 2020 June planted acres to PP and see what we get. NASS June estimates result in a grand total for corn and soybeans of 183.4 million planted acres. I just don't think that is realistic.

6. Here is what I did for an alternative estimate. I assumed that grand total for 2020 was same as 2019 at 181.7 million acres. Subtract 7.5 million acres of PP we then have 174 million to allocate to corn and soybeans.

7. I made corn and soybean planted acreage "fit" the 174.2 million planted total by dropping corn a million acres below NASS and soybeans by 665 thousand below NASS. So, this method yields planted acreage estimates of 91 million for corn and 83.2 million for soybeans.

8. Important to recognize that even if I am right that these declines in planted acreage will not have huge market impacts. And, of course, I can always be wrong!