Sharp cuts this year in U.S. plantedacreage may not make a big dent in the U.S. grain stockpile but
will at least keep grain surpluses from increasing, Agriculture
Department and industry commodity analysts said.
    "The scenario is turning around on stocks. The whole
supply/demand picture could finally be getting more in
balance," a USDA analyst said.
    The USDA prospective plantings report this week indicated
that U.S. farmers will idle 52 to 55 mln acres in annual
acreage reduction programs this year. An additional 20 mln
acres have been enrolled in the conservation reserve program,
bringing total idled acreage in the U.S. to 72-75 mln acres,
almost a third of the nation's total 235 mln acre crop base.
    Production of wheat, corn and soybeans in 1986/87 will
probably closely match annual usage, limiting any buildup in
stocks, analysts said.
    "It's a substantially different story from last year when
we added 1.5 billion bushels of corn to the stockpile," Vernon
McMinimy, director of commodity research for Staley Co. said.
    Interviewed at an agribusiness education conference here,
McMinimy said that 67.6 mln planted acres of corn will likely
translate into 60 mln harvested acres, and with normal yields,
final production of 6.9 to 7.0 billion bushels.
    McMinimy estimated that total U.S. corn disappearance in
1986/87 could end up at 7.1 billion bushels, possibly resulting
in a 200-million bushel reduction in the current corn stockpile
of 5.45 billion bushels.
    "To say this represents a turn-around is wrong, but we're
at least in a holding pattern," George Hoffman, director of
commodity analysis for Pillsbury said.
    Hoffman said wheat stocks could rise slightly by the end of
1986/87 to 1.9 billion bushels due to "significantly less"
domestic feed use for wheat because of lower corn prices.
    USDA analysts, however, project slightly higher usage and
said wheat stocks will either decrease slightly or at least not
increase. With yearly use at around two billion bushels, next
year's projected crop could be used up, an analyst said.
    "We won't be adding to stocks. Stocks are at a record now,
so if we can begin to touch them even minutely through acreage
reductions, that would be an improvement," an Agriculture
Department wheat analyst said.
    Soybean planted acreage, at 56.9 mln acres, would be the
smallest planted soybean acreage since 1976 and could lower
final production by 150 mln bushels and ending stocks by 50 to
100 mln bushels, analysts said.
    As more marginal, erodable acreage is enrolled in the
conservation reserve program, annual acreage reduction programs
will be more effective because they will force more high
producing land out of production, a USDA analyst said.
    "We can now maybe see the light at the end of a very long
tunnel," the analyst said.
 Reuter
