LITTLE ROCK — Arkansas farmers planted less rice in 2011 than the year before, opting to sow more soybeans, cotton and corn, according to the U.S. Department of Agriculture.
As a result, production of soybeans and corn was the second-highest on record in the state.
Rice acreage shrank last year after farmers planted a record 1.785 million acres of it in 2010, causing an oversupply and a flat market. Last year, rice acreage dropped 35 percent to 1.15 million acres.
Arkansas grows about half of the U.S. long-grain rice.
“The rice market is just dead,” said Bill Herrington, president of Price Risk Management, a Little Rock-based commodities brokerage firm.“The price just isn’t there to justify planting a lot of rice.” Adding to the low figures was excessive rain in the spring. Additionally, rice is more expensive to plant than the other row crops, USDA rice analyst Nathan Childs said.
Still, per-acre rice yields were up, to an estimated average of 6,770 pounds, about 290 pounds more per acre than in 2010.
Many farmers grew soybeans instead, according to Childs. And they were rewarded for increasing soybean acres by 4 percent to 3.27 million acres. Yields were up 8.5 percent.
Total estimated soybean production for 2011 was 124 million bushels, the second highest soybean production on record.
“The rotational crop of choice for rice farmers is soybeans,” Childs said. “But some farmers likely switched to cotton and corn, too.”
Nationally, the USDA estimated soybean stockpiles at maybe 275 million bushels, 20 percent more than forecast last month. That caused soybean prices on the Chicago Board of Trade to slide throughout the day Thursday.March futures prices were down 20.5 cents to $11.83 a bushel.
Bobby Coats, a University of Arkansas Division of Agriculture professor, said the price of soybeans “really attracted” a lot of farmers.
Corn growers in Arkansas planted 37 percent more corn than they did last year, with an estimated 520,000 acres harvested. Yields, on the other hand, were down by 5.3 percent to 142 bushels.
Production totaled 73.8 million bushels, the second highest on record behind 2007’s 99.7 million bushels, the USDA said.
Nationally, corn production was higher than expected, sending the price of it down on the Chicago Board of Trade. Corn prices fell to their daily limit, with the March delivery contract down 40 cents at $6.11per bushel.
Corn prices have fallen 24 percent from June, when concerns about a potential shortage sent the price to a record $7.99, the Associated Press reported.
The move could have “a major impact” on what U.S. farmers plant, calling into question whether they will plant as much corn as expected, Joe Vaclavik, analyst with Straits Financial in Chicago, told The Wall Street Journal.
Cotton was also up in 2011 by an estimated 120,000 acres from 2010 in Arkansas. The USDA estimates cotton hit 660,000 acres last year in the state. However, yields were down by 107 pounds per acre to 938 pounds.
Tom Barber, a cotton specialist with the Division of Agriculture, said that despite more cotton acreage, farmers weren’t pleased with last year’s yield.
“There were a lot of formidable challenges this year,”Barber said. “Last year everyone was excited [about cotton] because market prices increased. But excessive rainfall forced many farmers to plant late.”
He said cotton future prices last year rose above $1.30 a pound but fell to near 80 cents a pound later in the year. On Thursday, March prices were about 95 cents, down 1.18 percent from the previous close.
In the U.S., cotton production was estimated at 14.83 million bales, down 1 percent from last month’s estimate and 12 percent from last year’s. Most of that decrease is due to drought in Texas, Barber said.
Arkansas “cotton producers are not real happy with the crop,” Barber said. “I don’t really know right now [what will happen in 2012]. The market is trending upwards. If it gets above $1, it could increase above last year, but if it doesn’t, I expect it will remain flat or decrease.”
Business, Pages 29 on 01/13/2012