GRAIN REPORTS IMPROVE U.S. FARM OUTLOOK-ANALYSTS
The U.S. grain planting intentions and
stocks reports bear optimistic news for U.S agriculture, a
grain analyst on a Chicago Board of Trade panel said.
    The decline in intended soybean acreage and lower stocks
are "the first report we've had for a long time that shows any
optimism for anybody," said John "Bud" Frazier, grain analyst
and executive vice president for Balfour MacLaine, Inc.
    "I'm really excited about it," Frazier said.
    The U.S. Department of Agriculture said farmers intend to
plant 67.6 mln acres of corn, down from 76.7 mln planted last
year, and 56.8 mln acres of soybeans, down from 61.5 mln.
    The report showed March 1 stocks of 1.4 billion bushels of
soybeans, 8.3 billion bushels of corn, and 2.3 billion bushels
of wheat, all below trade guesses.
    Frazier was joined by Susan Hackmann, senior grain analyst
with AgriAnalysis, and Mark Meyer, a grain analyst with
Shearson Lehman Brothers, Inc., on a Chicago Board of Trade
panel to discuss the reports.
    Frazier said the stocks reports in particular were friendly
for the market, and soybean prices would jump three to five
cents a bushel "if the bell rang right now."
    "We're getting our disappearance up. We have less (corn and
soybeans) than we thought we had," he said, noting that hog and
poultry production is up.
    "We're seeing low prices generate some interest in demand,"
said Meyer, adding that feed use was up 13 pct last quarter and
15 pct in the preceding quarter.
    However, Hackmann said production could continue to exceed
consumption.
    She noted that most of the reductions in soybean acres came
in southeastern states, where yields are usually low.
    "We have the potential for record breaking soybean yields
this year, (which) will temper the enthusiasm on tomorrow's
opening," she said.
    Hackmann said record corn yields also are possible, and the
crop could reach 7.1 billion bushels, which would be down from
last year's 8.25 billion bushels.
    "We'll need very good disappearance next year to reduce
stocks," she said. The USDA estimated disappearance last year
at 6.7 billion bushels.
    Hackmann said the stocks report was positive for the long
term, "But we still have a long way to go to bring stocks down
to where we could start rebuilding prices."
    Frazier also cautioned that the soybean acreage report
could prompt farmers to change their plans and plant more
soybeans.
    The panelists agreed that the reports should discourage
talk of revising the 1985 farm bill.
    "There seems to be no desire ... to change the farm law
we're working under today, and this report should reinforce
that," Frazier said.
    "We are seeing the program beginning to work," said Meyer.
 Reuter
