USDA: Total U.S. crop acreage seen falling with prices

U.S. farmers will cut plantings of the eight major crops by 1 percent to 249.1 million acres in 2016, with expectations for weak prices cutting into seedings, the U.S. Agriculture Department said on Thursday.

"Farm budgets have been tightening with lower prices," USDA Chief Economist Robert Johansson said in a speech outside Washington, D.C. at the government's annual Agricultural Outlook Forum.

The biggest projected decline was in wheat, with total wheat seedings projected at 51.0 million acres, down 3.6 million from last year and the lowest since 1970, if realized.

The USDA in January estimated plantings of winter wheat at 36.6 million acres, a six-year low that Johansson described as "an early indication that lower prices are pressuring area."

Plantings of spring wheat were seen falling 5 percent from 2015.

"Current low prices will tighten the producers' purse strings and reduce their desires to plant marginal acres around the central U.S.," said Jerry Gidel, analyst with Rice Dairy.

The USDA projected soybean planted area would fall 200,000 acres from 2015, to 82.5 million acres. The decline contrasted with a Reuters survey of analysts that projected soybean area would expand in 2016 to 83.3 million acres.

"If there’s one number here that the trade is suspicious of, it’s the soybean acreage," said Terry Linn, an analyst with the Linn Group. "I think we will ultimately see an increase," Linn said, adding that soybeans could be seeded on fields that in past years went to wheat, cotton or other crops.

Bucking the trend of reduced acreage in other grains, USDA projected U.S. farmers will boost seedings of corn, the biggest U.S. crop, by 2 million acres to 90 million.