EVERY year USDA surveys producers on or about March 1 regarding their spring planting intentions and reports the results at the end of the month, but never have the results of that survey been as highly anticipated as they are this year. The numbers reported on March 31 will set the tone for price activity throughout the growing season, but expect the markets to be anything but calm beyond that point. The markets succeeded in buying a 19% increase in corn acres in 2007 to meet demand for a rapidly growing ethanol industry. Corn can afford to give up 2 million to 3 million of the 15.3 million acres it gained in 2007 as long as growing season weather is good and yields reach trend levels. Otherwise, prices will need to rise higher to ration demand and encourage production in the Southern Hemisphere later this year.
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