March 29 – Like Canada, USDA Expects Lower US Peas Acreage in 2018/19

Today, we got the USDA’s announcement of what 2018/19 dry edible peas acres are going to be in America. Here’s our breakdown of the numbers.

Today, we got the USDA’s announcement of what 2018/19 dry edible peas acres are going to be in America. Here’s our breakdown of the numbers.

The USDA’s Prospective Plantings report showed the market that American farmers will plant 908,000 acres of peas in 2018. This is 20% lower than last year’s 1.13 million acres of peas that were seeded for the 2017/18 crop year.

Compared to the five-year average of 1.09  million acres, 2018/19 American peas acres are 17% lower.

Going into the report, there was no average US guesstimate for the US peas crop, but the reduction was widely expected, given the pullback in prices thanks to India’s 50% import tax. Pulses, including peas, are the major losers in the battle for acres worldwide.

In breaking the US acreage down state by state, here’s what’s notable. In brackets, the first number is the change year-over-year, while the second number is the change compared to the five-year average.

  • Montana:  390,000 acres (down 26% YoY; down 28% from 5-year average)
  • North Dakota:  360,000 acres (down 15% YoY; down 7% from 5-year average)
  • Washington:  56,000 acres (down 8% YoY; down 34% from 5-year average)

Overall, this is the first pass at acres. But if you look at the chart, you can tell that, over the past five years, the USDA has often raised acres by the end of the growing season.

Again, we expected this lower number, which is being echoed in 2018/19 Canada peas acres, as well as 2018/19 acres of Australia peas.

One could easily argue that we’re finding a new supply-demand equilibrium which will help level prices out. The next thing we’ll be watching for is the likes of China coming back to the market in the spring (it’s a bit of a seasonal thing).

H/T: USDA
About the Author
Brennan Turner

Brennan Turner is the CEO of FarmLead.com, North America’s Grain Marketplace. He holds a degree in economics from Yale University and spent time on Wall Street in commodity trade and analysis before starting FarmLead. In 2017, Brennan was named to Fast Company’s List of Most Creative People in Business and, in 2018, a Henry Crown Fellow. He is originally from Foam Lake, Saskatchewan where his family started farming the land nearly 100 years ago (and still do to this day!). Brennan's unique grain markets analysis can be found in everything from small-town print newspapers to large media outlets such as Bloomberg and Reuters.