March 2021 USDA Quarterly Grain Stocks and Prospective Plantings

Farmers tell USDA, “We are not planting as many corn and bean acres as traders expected.”

The quarterly stocks were slightly smaller than expected for corn and slightly larger on beans and wheat. No surprises in the Stocks report.

Source: USDA, Reuters, StoneX

Although corn acres are up less than 0.5%, four out of the top five states cut corn acres.

Farmers decided to plant 5.4% more soybeans nationally and increased acres in each of the top five bean states.

The surprise came in the wheat complex, where acreage was up 3.4% from the last estimate and a whopping 8.8% from last year.

The bullishness in today’s reports is a little surprising, since acreage can certainly increase between now and the June report. By boosting the prices, traders will encourage the additional corn and bean acres the marketplace wants.

How about the Buy Signals on soybeans, meal, and wheat this morning?

Our strategy is to make an increment of sales on the next Sell Signal, which should be just around the corner.

Source: All Slides from the USDA Executive Summary

For full USDA reports, click on links below.

Grain Stocks Prospective Plantings

Prospective Plantings

Grain Stocks

March 2021 USDA Supply & Demand

USDA leaves U.S. numbers mostly unchanged and tightened world wheat numbers slightly

Traders’ initial reaction to USDA numbers put pressure on corn and beans but boosted wheat prices. As you can see from the tables below, U.S. carryover numbers were unchanged from last month.

World corn and bean carryover numbers were just slightly changed. World wheat carryover declined by 3 million tons.

South American crops were little changed. Brazilian bean production was increased by 1 million tons.

Source: USDA, Reuters, StoneX

February 2021 USDA Supply & Demand

The USDA disappointed bullish traders with conservative usage and carryover estimates.

The USDA corn demand estimates might have surprised traders the most. After seeing big business to China in corn and ethanol, traders had allowed their demand ideas to expand beyond the amounts the USDA was comfortable with.

USDA left U.S. ethanol production unchanged, raised corn exports by a measly 50 million bushels, and lowered U.S. corn ending stocks by 50 million bushels, compared to the 160 million bushel reduction traders were expecting. Corn reacted by trading down 10 cents.

U.S. bean carryover was reduced to 120 million bushels compared to the average trade guess of 123 million bushels. There were little changes in U.S. bean usage. U.S. bean exports were increased by 20 million bushels. South American bean and corn production numbers were left unchanged.

All wheat supply demand numbers were left unchanged from last month.

When the smoke cleared traders were left with disappointing U.S. numbers heading into the South American harvest.

Source: USDA, Reuters, StoneX

January 2021 USDA Supply & Demand, Grain Stocks, and Winter Wheat Seedings

January 2021 USDA Supply & Demand, Grain Stocks, and Winter Wheat Seedings: USDA tightens stocks

The USDA reduced nearly all U.S. numbers below the average trade estimate. Supplies are smaller than traders thought, and markets surged.

The biggest surprise in today’s estimates came in the corn market. The USDA reduced the U.S. 2020 corn yield by 3.8 bushels from their December estimate, taking it down 3.3 bushels from the average trade estimate. U.S. corn production was pegged at 14.182 billion bushels, down from 14.507 billion bushels in December.

U.S. corn carryout was cut 150 million bushels, down to 1.552 billion bushels.

The USDA also reduced the U.S. bean yield by 0.5 bushel/acre down to 50.2 bushels per acre, 0.3 bushels below trade estimates. That pulled U.S. bean production down 35 million bushels from the December estimate and 23 million below trade estimates.

The USDA pegged U.S. soybean carryout at 140 million bushels down from the December estimate of 175 million bushels. This was one of a few estimates that were bigger than the trade expected, their guesses averaged 139 million bushels.

U.S. wheat carryout for the 2020-21 crop was reduced to 836 million bushels, down 26 million bushels from December and 23 million from the average trade guess.

Source: USDA, Reuters, StoneX

In Brazil, the USDA’s production estimates were larger than trade expectations. Brazilian corn production estimate was only cut by 1 million tons to 109 million tons, compared to a trade expectation of 107.7 million tons.

The USDA Brazilian bean production estimate was unchanged from December at 133 million tons, compared to a trade expectation of 131.4 million tons.

The USDA Argentine production estimates were lowered from December, but more in line with the trade estimates than the Brazil numbers.

Source: USDA, Reuters, StoneX

U.S. winter wheat seedings were 5% bigger than last year, totaling 31.99 million acres. That was less than a half a million acres larger than trade expected.

Source: USDA, Reuters, StoneX

As you can see in the table below corn stocks are down sharply from trader expectations and are about the same as last year. Bean stocks are slightly larger and wheat stocks are also down 20 million bushels.

Source: USDA, Reuters, StoneX

December USDA Supply & Demand

December 2020 USDA Supply & Demand: USDA cuts bean stocks slightly. Corn left unchanged.

The USDA delivered a typical December WASDE report. They acknowledged the faster than expected pace of domestic crush and raised crush by 15 million bushels. Surprisingly, exports were left unchanged.

U.S. corn estimates were left unchanged.

U.S. wheat imports were reduced by 5 million bushels and exports were increased 10 million bushels, leaving carryout 15 million bushels smaller.

The USDA reduced Argentine corn and beans production by 1 million metric tons each. Brazil production was left unchanged.

After further analysis, this report was a non-event.

Without new bullish fundamental news to support a rally, we could see markets rollover as funds exit winning positions before the end of the year. Get ready for Buy Signals in corn and beans.

Source: USDA, Reuters, StoneX

November USDA Supply & Demand

The USDA reduced U.S. corn and bean yield and production estimates even more than traders expected, giving us a solidly positive report for corn and beans. Wheat, not so much.

Soybean production was forecast at 4.17 billion bushels, down 98 million bushels on smaller yields. Soybean ending stocks were reduced by 100 million bushels from last month.

Foreign oilseed production was lowered 5.6 million tons to 473.3 million tons.

Corn production was forecast at 14.507 billion bushels, down 215 million bushels from last month, with yields cut to 175.8 bushels per acre. Corn exports were also raised by 325 million bushels to a total of 2.065 billion bushels – a new record. Feed and residual use was cut by 75 million bushes and ending stocks were cut by 465 million bushels to 1.7 billion bushels, the smallest since 2013-14.

Global corn ending stocks were 291.4 million tons, down 9 million from last month.

Wheat usage was raised by 5 million bushels based on higher food use during the marketing year. Ending stocks were reduced by 6 million bushels to 877 million bushels.

China’s import pace continues to be robust and at 8.0 million tons, imports would be the largest since 1995/96. Projected 2020/21 world ending stocks are lowered 1.0 million  tons to 320.5 million but remain record high.

Source: USDA, Reuters

October USDA Supply & Demand

The USDA pegged the U.S. wheat carryout at 883 million bushels, 42 million bushels below their September report and almost exactly what the trade expected. The smaller stocks came from a 0.4 average bushel per acre reduction, slight adjustment in usage and the carry-in stocks revision.

The USDA pegged U.S. corn yield down 0.1 bushel per acre, slightly larger than trade estimates. Harvest acreage was reduced by 1 million acres and usage was cut by 100 million bushels, split between export and domestic.

Corn ending stocks were reduced but were slightly higher than trade estimates and growers still have more than 2 billion bushels scheduled for a birthday.

The USDA pegged the U.S. soybean yield at 51.9 bpa, unchanged from last month, but 0.3 bushels bigger than traders expected. The positive news came in the bean harvested acreage which was also cut by 1 million acres. In addition, exports were increased by 75 million bushels.

The bean carryover estimate came in at 290 million bushels, well below trade estimates of 369 million bushels and last month’s estimate of 460 million bushels.

If you look back at last week’s Thursday Daily Grain Plan, you will see our forecast came to nearly the same bean carryover number. Be careful about becoming too optimistic about today’s estimates, traders have traded these numbers for at least a week.

Here is why/how the government changed their numbers.

Source: USDA, reuters, StoneX