A USDA report released Friday on the number of acres planted by U.S. farmers sent crop prices up sharply.
The U.S. Department of Agriculture projects that American farmers will plant the most corn acres since 1937, 95.9 million acres. The amount of winter wheat acres is also up, while soybean acres are expected to decline slightly.
The price of corn and wheat rose nearly 7 percent, while soybeans were up 3.5 percent.
The price of cattle, for which the cost of grain is a key input, suffered a drop of 1 to 2 percent.
In Kansas, farmers moved in the opposite direction. Following a difficult, drought-afflicted 2011, Kansas farmers are expected to trim corn acres by 200,000 to 4.7 million. Soybeans acres are also down 100,000 acres to 3.9 million. Instead, farmers have planted 9.5 million acres of wheat, up 700,000 acres.
Kansas farmers may have switched some of their corn acreage to wheat to recoup some of their lost income with a crop that is harvested earlier, said Tom Leffler, owner of Leffler Commodities in Augusta.
The outlook for prices seems strong in the near future, but wheat and corn prices could fall as the year wears on.
Beyond supply and demand, Suderman pointed to risks such as a military conflict in the Middle East sending speculators to the sidelines, pulling billions out of the market. Another factor will be whether the Chinese economy slows softly or sustains a harder crash.