Corn and soybean prices were up sharply Tuesday, their biggest rally in five years, after the Agriculture Department reported the latest planting data showing the effects of a soggy spring that limited farmers' ability to get their crops in and may diminish harvests.
Accompanying reports on the volumes of both crops in U.S. storage were lower than markets had estimated.
Corn and soybean conditions in Illinois, Indiana, Iowa and Ohio have deteriorated in recent weeks with the heavy rain. Farmers who won't get their soybeans fields planted by Wednesday may be forced to use crop insurance to cover the lost production.
Missouri and Illinois experienced the wettest June since the National Weather Service began keeping records in the late 1800s. More than a third of Missouri's intended soybean crop has gone unplanted, and Kansas has 14 percent that's unplanted.
U.S. Department of Agriculture’s National Agricultural Statistics Service still estimated a record soybean acreage nationwide, 85.1 million acres, up 2 percent from last year and up from the March estimate. Nonetheless, soybean futures prices closed up 53.5 cents a bushel to $10.56, more than 5 percent, as market analysts doubt the weather will support the crop's potential.
In contrast, growers planted an estimated 88.9 million acres to corn, fewer than estimated in March and the lowest corn acreage in the United States in the last half a decade. July corn futures were up 30.75 cents a bushel to $4.14, 8 percent.
Corn, soybeans and wheat erased their 2015 losses on Tuesday.
"Big crops [are] getting smaller," Societe Generale analyst Christopher Narayanan told Agrimoney.com. "With crop conditions declining, and slow development the wet weather provides yet another risk to the supply side of the crop balances."
Nebraska corn planting acreage estimates were unchanged from March, 9.3 million acres, matching last year, but soybean acres were down 4 percent from last year to 5.1 million acres, and down from a 5.2 million estimate in March.
USDA reported 92 percent of all corn acres planted in the United States and 94 percent of soybeans are genetically engineered varieties. In Nebraska those numbers are 96 percent genetically modified corn and 95 percent for soybeans.
Because of bad weather, sorghum remains to be planted in Kansas, which grows 37 percent of the U.S. total, and soybeans aren't all planted in Arkansas, Kansas, and Missouri, representing 15 percent of U.S. total soybeans acreage combined, USDA said.
To ensure accurate final estimates for all crops, the agency said it will resurvey growers in these states. If the new data justify any changes to the current estimates, USDA said, it will publish updated estimates in its Crop Production report on Aug. 12.