Grains –
USDA today will release its “early look” of selected tables on its long-term projections through 2026 later this morning. I personally never put too much thought into these figures, as they are mainly done for government budgeting purposes, but one can never really tell what will excite the market.
The primary focus today from these numbers will be the acreage projections. In terms of wheat, these numbers will not breakdown acreage by class, but instead we’ll merely get one all-wheat acreage estimate in the balance sheet (with likely no other details). Note that last year’s November wheat estimate posted an all-wheat planted area estimate of 53.0 mil acres vs. the reality of 50.2 mil now that all has been said and done. That isn’t said to poke fun at whomever is tasked with producing this estimate, however, and the market in general has proven to be quite inept in figuring wheat area over the past few years. 
The breakdown to the right shows how notoriously bad the market has been in recent years in trying to determine winter wheat area heading into the Jan report. Only twice did the average guess prove to be too low during this stretch, and one of those years was basically an exact match. The point here is, it seems highly likely that we’re expecting too much winter wheat area right now.
Of course the all-wheat area estimate will probably take a back seat to the corn and soybean guesses for 2017. I think most agree that current economics favor a higher level of soybean acreage in the US next year, but the debate regards to what degree. As the chart shows, the soy/corn ratio is sharply higher than we’ve seen in recent years, though obviously we’re still a ways off from finalizing planting decisions (in general). Considering the outlook released today from USDA is preliminary, I would only look for a modest increase in soybean area today vs. corn. I doubt this will prove to be market-moving, but you just never know.
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