WASHINGTON (B)--Despite continued low commodity prices, USDA estimates that planted acreage of wheat and corn will fall only slightly from 1996-97, when prices were very high, with soybean acreage increasing slightly, an agency official said. USDA attributes the difference between the price fall and current plantings to high marketing loan and deficiency payments that allow U.S. producers to continue covering their costs.

Speaking at USDA's 2000 Agricultural Outlook forum, senior Farm Service Agency official Thomas Tice said that despite a roughly 40% decline in average U.S. grains and oilseeds prices since 1995-96--when prices were at their highest level in the 1990s--USDA reports that planted acres of wheat, corn and soybeans have only declined 2.3%--or 5 million acres--during the same period.

"In the short run, producers are likely to plant as long as viable cash expenses are covered by production-related revenues--market receipts plus marketing loan benefits," Tice said.

According to Tice, "market payments" to U.S. farmers for wheat fell are expected to fall to $108.08 per acre in 2000 from $133.51 in 1997 while deficiency payments-marketing loan payments will rise to $9.43 per acre in 2000, up from 40 cents per acre in 1997.

The gain was even greater for

corn during the same period, with farmers expected to receive $264.23 per acre from the market in 200 0, down from $307.88 in 1997, while deficiency payments are expected to rise to $29.81 per acre in 2000 from $1.27 in 1997.

Soybeans saw the greatest deficiency payment gain of all during the period, with the market price falling to $178 per acre in 2000 from $251.68 in 1997, while deficiency payments rose to $38.80 per acre in 2000, from 39 cents in 1997.

Tice said producers in the corn belt and northern Plains states will favor feed grains and oilseeds over wheat in 2000. Soybean plantings are expected to rise in 2000-01 to 75 million acres from 73.8 million in 1999-00, while wheat will decline to 62 million acres in 2000-01, down slightly from 62.8 million in 1999-00. Corn will also fall slightly to 77 million in 2000-01 from 77.4 million in 1999-00.

Tice said 2000 is the fourth consecutive year of declining wheat plantings, and said that much of the decline this year will come from lowered plantings of durum. Dry weather in the southern and central Plains has also caused a decline in red winter wheat plantings.

Domestic demand for wheat and corn is expected to remain largely unchanged from 1999-00 levels, according to Tice, with domestic wheat use and exports expected to remain flat as well. Corn consumption for food and feed is expected to change little, although Tice said increased dairy production across the U.S. will keep feed demand strong. Corn exports, however, are not expected to increase, due mainly to large Chinese stocks and larger corn plantings in other significant maize exporters, such as Argentina.

U.S. domestic soybean use is expected to increase to 1.8 billion bushels in 2000-01, up from 1.76 billion bushels in 1999-00. Exports are also expected to increase to 985 million bushels in 2000-01, up from 890 million in 1999-00.

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