After the rains, early expectations place corn at the top.

The agriculture economy relies heavily on the production of crops and all the moving parts that surround commodities from the field to the bank. Each year, the USDA's National Agriculture Statistics Service (NASS) releases a national planting intentions report and individual state reports.

The latest of these came on March 31, just as planting season was beginning, and for Kentucky farm families, just as one of the worst weather weeks in years swept through and changed many farmers' plans to be in their fields.

If the weather cooperates from this point forward (this is being written in mid-April), whatever strategy each producer had in place for their respective operations will likely not change. However, for those who plant on river bottom land or for those who saw excessive flooding in the crop fields, adjustments may need to be made in relation to what Mother Nature has in mind for the next several weeks.

As it currently stands, Kentucky producers intend to plant 1,600,000 acres of corn this year, which, if it all comes to fruition, will be one of the largest crops, acreage-wise, since 2012. It may come as a surprise to some that in 1926, a much larger corn crop was planted in this state. That year, the number of planted acres stood at 3,069,000, according to David Knopf, Regional Director, USDA Nass Eastern Mountain Region and Northeastern Region. The largest number of harvested acres on record is 2,925,000, also in 1926.

Taylor Thompson, KFB Federation Commodity Marketing Specialist, said as the years have passed and farmers have become adept at getting the most out of their harvested acreage, today’s 1.6 million acres of planted corn will roughly yield seven times what was realized in the harvest of 1926.

“It’s amazing how productive our farmers have become through the years thanks to their tenacity and willingness to learn more and how to get the most yield from their crops,” he said. “Of course, advanced technology and the amount of research that has been conducted over the years has also played a major role in our ag production numbers.”

Looking at it from a historical perspective, in 2024, Kentucky corn producers harvested 1,280,000 acres, with an average yield per acre of 178, which added up to 227,840,000 total bushels.

"In 1926, based on the number of harvested acres, and the average yield per acre (27.5 bushels), the total production for that year would have been 80,438,000 bushels," he said. "To say we have become more productive on the farm in the last 100 years is a gross understatement."

Kentucky Planting Intention NASS report highlights for grain: 

• Growers intend to plant 1,600,000 acres of corn in 2025, up almost 17 percent from last year and equal to the number of acres planted in 2023.
• Aside from 2023, this is the largest corn acreage since 2012, when 1,650,000 acres were planted.
• Farmers plan to plant 1,850,000 acres of soybeans in 2025, down 10 percent from last year, but up one percent from 2023. Planted acreage over the past 10 years has averaged 1,876,000.
• Farmers seeded 500,000 acres of winter wheat this past fall, down almost 11 percent from a year ago and the fewest acres since 2019.

The economics of it all

As with any product one sells, be it from the farm or the factory, there must be a buying market for those products. The commodities’ markets, however, can be quite complex, but the basic principles remain the same.

In exploring what the recent planting intention report denotes, the one thing that immediately stands out is the 17 percent increase in intended corn planting over the 2024 crop. 

Many of the planting decisions follow a farm’s crop rotation plan. But market conditions also contribute.

 “There's been a lot of incentive in the market for folks to plant corn when we look from a price perspective at the competitiveness of corn relative to soybeans,” Thompson said. “That's something that our growers, and growers throughout the U.S., have kept an eye on. As the USDA information indicates, it's looking like people are going to plant more corn relative to beans. That's been led a lot by the market indicators, the futures prices that we've seen.”

Thompson noted that crop producers continually look at the markets as a way to incentivize their planting intentions.

“We've seen corn perform pretty well here, not only as of late but earlier on in the year, and for a lot of folks, that's pretty attractive given some of the challenges they are seeing in the soybean markets,” he said. “We also have to factor in trade issues and our customers outside of the U.S.”

While American farmers are still regarded as the most effective and safest producers in the world, international trade can play a huge role in planting decisions.

“There's a lot of competitiveness out of South America for the soybean market, and our trade relations with China factor into this,” Thompson said.  “Farmers understand this clearly, and are very sensitive to trade, understanding the challenges that are out there.”

Thompson added that when you take these price dynamics into play, growers in this country are looking not only in the short term but factor in what rotations may look like for years to come.

While export markets are a crucial component for this country’s agricultural industry, Thompson said there are many domestic market opportunities, as well, including the livestock sector. According to information from the University of Kentucky Martin-Gatton College of Agriculture, Food, and Environment where, by some estimates, 60 percent of the state's corn crop is used for livestock feed.

“From the grains perspective, it is so vital to what we do to have a strong livestock industry. And we’ve got a dynamic livestock sector,” he said. “In thinking more broadly about how we are going to trade internationally in light of current events, if there's going to be international relations that are going to be impacted, let's sell more in-house.”

One such opportunity on the horizon in the beginning stages is the use of domestic fuel stocks, such as grain for synthetic aviation fuel (SAF).

“This would be a new market source and a huge market for our grain producers,” Thompson said. “We have a long way to go with that, but there are exciting opportunities domestically that we can work toward.”