By Tom Polansek
CHICAGO, Feb 10 (Reuters) - The U.S. Department of Agriculture, long the world's gold standard for crop estimates, faces mounting doubts about the reliability of its data from farmers, grain
traders and economists following deep staff losses and a sharp upward revision in how many acres of corn were harvested.
Farmers, traders and food manufacturers everywhere closely follow monthly USDA reports on production, supplies and demand so they can anticipate prices and inventories.
Thousands of employees left USDA last year as part of President Donald Trump's drive to shrink the federal government, and experts worry the shrinking staff hobbled the agency's ability to produce accurate and timely data.
USDA's final estimates in January for how many corn acres farmers planted and harvested in 2025 represented unprecedented increases from initial estimates in June. Already-low grain prices sank more than 5%, at a time when growers were struggling to make money.
USDA data last month "appeared to reflect an agency in disarray," said Arlan Suderman, chief commodities economist for consultancy StoneX, citing changes to acres and other estimates.
The revisions prompted USDA's National Agricultural Statistics Service, which releases acreage estimates, to launch an internal review, said Lance Honig, a top NASS official.
At the Farm Service Agency, another USDA branch, staffing reductions hampered employees from processing data on plantings last summer and feeding it to the statistics service, said Spiro Stefanou, a former acting USDA deputy undersecretary who resigned last fall. This delayed the statistics service from receiving a complete picture of acreage, he said.
"NASS had less information to go on," Stefanou said. "That was going to make their estimates less reliable."
Last summer, Trump fired a top Labor Department official following a weak scorecard of the U.S. job market, stoking concerns about the quality of federal government data.
MASSIVE CROP ADJUSTMENTS
Corn, America's largest crop, is used to feed millions of farm animals, produce ethanol and sweeten foods including ketchup and ice cream.
Last month, farmers and analysts largely expected USDA would hardly adjust its estimate for harvested acres, already the largest since the 1930s. Instead, USDA hiked it to 91.3 million acres, up 1.3% from the previous estimate and 5.2% higher than in June.
"All of a sudden we had acres popping up all over the place," said longtime analyst Sid Love.
Smaller revisions are common, often in the form of decreases, as poor weather can reduce acres that farmers harvest. Over the last 15 years, harvested acreage estimates on average slipped about 0.7% from June to January, according to a Reuters analysis.
Last month's increase unexpectedly raised USDA's corn production estimate and sank futures prices by 5.4%.
INTERNAL REVIEW
USDA based June acreage estimates on surveys of nearly 68,000 farmers, who have grown increasingly reluctant to participate. It used the results to estimate harvested acres until surveying farmers again in December and then published the updated results in January, Honig said.
As part of its review, USDA will confirm its procedures worked as they should, Honig said. The agency is also exploring options for improving harvested acreage estimates, most likely without more farmer surveys, he said.
In January, it made sense to increase the number of acres harvested for grain because poor weather had not hindered farmers, Honig said. Also, plantings were larger than previous years, and the number of acres harvested for silage, a form of livestock feed made from the whole corn plant, stays relatively unchanged annually, he said.
The USDA in June estimated that farmers planted 95.2 million acres, up 5% from the previous year. At the time, plantings were nearly complete, raising confidence in the estimate among traders and farmers. Many farmers delayed crop sales due to low grain prices and did not know that plantings were even larger than they thought.
USDA raised its estimate by more than 2% in August, lowering corn prices 3%, and again in September. By January, USDA estimated plantings were 98.8 million acres, up 3.8% from its initial estimate.
Some farmers said they did not understand why USDA could not produce a better assessment in June.
"Given the turmoil and turnover at the USDA at the time, there were already concerns about data quality, with the miss from June to final doing everything to reinforce those fears," said Angie Setzer, partner at advisory firm Consus Ag Consulting.
"A swing of this size from June to final plantings has never happened before, making many feel it is more difficult to adequately manage risk."
STAFFING CUTS HAMPER AGENCY
Honig said it was not clear why USDA's initial plantings estimate fell short.
In August and September, when USDA mostly increased the plantings estimate, the statistics service incorporated Farm Service Agency data as part of its typical procedures.
Farmers are required to report plantings to the Farm Service Agency to be eligible for loan and revenue programs that cover a vast majority of acres.
In the first half of last year, Farm Service Agency lost about 24% of its employees while the statistics service lost 34% as USDA employees resigned, retired and were terminated, according to government data.
With fewer workers, Farm Service Agency focused on providing money to farmers, its primary function, not on processing and reporting plantings data to be incorporated into acreage estimates, said Stefanou, former administrator of USDA's Economic Research Service.
"It's the cascading effect of the deferred resignation program," he said.
Honig said FSA reported and processed plantings data a little slower but that he could not speak to the reason or about staffing in general.
Analysts said farmers' reluctance to respond to surveys and last year's increased plantings may have also made it difficult to estimate acres.
For Bill Lapp, president of consultancy Advanced Economic Solutions, USDA needs to do better.
"They blew the coverage here on this one."
(Reporting by Tom Polansek. Editing by Emily Schmall and David Gregorio)
