It's a simple formula—more acres equal more corn. Depending on favorable weather, the 2007 growing season promises to provide a bumper crop of corn production, according to the latest planting projections released today by the USDA.

While the results were widely expected, the increase in corn acres and related decrease in soybean acres was extreme. The USDA reported that corn growers intend to plant 90.5 million acres in 2007, up 15 percent from 2006 and 11 percent higher than 2005. If realized it would be the highest acreage since 1944 when 95.5 million acres were planted.

Corn production in 2006 was the third-largest on record, but slightly less than 2005 numbers, according to the USDA Crop Production 2006 Summary. The harvest brought in 10.5 billion bushels, 5 percent less than 2005 and 11 percent less than the record set in 2004. Fewer acres were planted in 2006 due to higher fuel and fertilizer costs. Lower than average precipitation also made a dent in overall harvest.

The jump in 2007 corn acres is mainly attributed to rising corn prices affected by a massive increase in fuel ethanol production. The U.S. ethanol industry produced 4.86 billion gallons of fuel in 2006, according to the Renewable Fuels Association (RFA). The industry is expected to have more than 8 billion gallons of production capacity on line within the next 12 to 18 months.

Soybean acres are projected to suffer due to the increase in corn. Illinois may provide the best example. The state's farmers intend to plant a record high 12.9 million acres of corn. The largest decrease in soy acres is expected from Illinois, which will plant 1.4 million less acres than 2006, according to the USDA.

Meanwhile, soybean producers intend to plant 67.1 million acres nationwide, which is down 11 percent from 2006. If realized, it would be the lowest planted area since 1996.

North Dakota and Minnesota are expected to plant record corn acres for each state. Iowa continues to lead the nation with a projected 13.9 million acres, up 1.3 million acres from 2006.

The USDA's figures are up from even early last month. USDA Chief Economist Keith Collins told attendees at the March 1 U.S. Ag Outlook Forum in Washington, D.C., that corn acres was expected to reach 87 million acres. He said the increase in acreage was expected to lead to a record net crop of 12.2 million bushels.

Collins' speech came two weeks after the USDA released its 10-year agricultural baseline estimates. The estimates projected continued ethanol expansion through 2009/2010. By the end of the projections, ethanol production exceeds 12 billion gallons per year, using more than 4.3 billion bushels of corn. The baseline also projects corn planted acres to level off around 90 million acres by 2010.

"The market is working," said RFA President Bob Dinneen. "Last fall, farmers received the signal that more corn for ethanol, livestock and other uses would be needed, and today we learn they are answering that call. The continued trend of increasing corn yields together with improved efficiency and new technologies in ethanol production and other agricultural industries will mean that American farmers will continue to feed the world while renewably fueling our nation."

Dave Nilles is Online Editor for Ethanol Producer Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

Posted: 9:38 a.m. CDT Friday, March 30, 2007