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Grain markets spiked at the beginning of July in response to the June 30 acreage report released by the USDA.

On the June acreage report, total acres saw corn planted estimates dropped by 5 million acres since the last estimates in March. Meanwhile, soybeans also saw a reduction in the report, which forced a couple days of double-digit gains in the futures market for the two commodities.

This came as a surprise to most analysts.

“The acreage report was a bit of a shocker,” said Todd Hubbs, an economist with the University of Illinois. “I was surprised. Acreage numbers for corn caught me by surprise a little bit and for principal crops in general.”

Hubbs noted a seven million acre drop in principal crops compared to the March intentions report.

Corn’s drop to 92 million acres in the report is “very bullish” for the market, Hubbs said.

“Inside that acreage number, (the USDA) said there are still about 2.2 million acres of corn they were forecasting to be planted from when the survey occurred (June 1),” Hubbs said. “I wouldn’t be surprised to see more corn acres come out of this before it’s all said and done.”

Hubbs said it makes sense that soybeans saw only a minimal reduction, as a price rally during the late planting season may have convinced some farmers to switch from corn to soybeans. He said he wouldn’t be surprised if there were another million acres of soybeans reported when the season is said and done.

John Payne, a Daniels Trading analyst, said the big news for anyone looking to be bullish in the corn market is the lower acreage, which would significantly impact this season’s supply.

“This is a pretty good development for corn,” Payne said. “My advice is to hedge up the March and May contracts in the short term. The weather looks good in corn, but you don’t know how much follow through there will be.”