7 February February 2024 USDA Supply & Demand February 7, 2024 By John Roach USDA Supply/Demand 0 The February USDA reports released Thursday was expected to be largely neutral, and the futures market’s immediate reaction appeared to confirm the predictions. The ripple effect of the USDA’s bearish forecast on Brazilian soybeans in comparison to Conab’s more-aggressive cuts left futures stuck in place for a while as analysts weighed the ripple effect on U.S. exports and ending stocks. Wheat futures quickly lost a dime or more while corn was little changed as well at midday. Corn: U.S. ending stocks were increased to 2.172 billion bushels (bbu) based on lower domestic use while global production was reduced on declines in Brazil and Mexico. Foreign The average price projection was unchanged at $4.80 per bushel. Soybeans: Slower exports cut the export forecast for the year by 35 MMT from January, leading to a new total of 1.72 bbu. Ending stocks were raised to 315 million bushels as the crush forecast remained unchanged, trimming the average price to $12.65 per bushel. Wheat: U.S. wheat supplies for 2023-24 were projected at stable with exports little changed at 725 mbu. Ending stocks were raised to 658 mbu with prices unchanged at $7.20 per bushel. The global supply was increased while ending stocks were trimmed to 259.5 million metric tons (MMT), the lowest since the 2015-16 year. South America’s 2023-24 production estimates were within expectations and not significantly changed from last month’s USDA projections. Brazil’s soybeans slipped to 156 MMT from 157 MMT. Corn was lowered from 127 MMT in January to 124 MMT, which was nary equal to the average estimates. Earlier in the day, Brazil’s Conab lowered its soybean projection to 149.4 MMT; the corn crop was cut 113.7 MMT and the outlook for the safrinha crop’ outlook was trimmed to 88.1 MMT. Projections for Argentina were unchanged from January and even with analysts’ predictions. Source: USDA, Reuters, StoneX Related Posts May 2024 USDA Supply & Demand This month’s WASDE report was surprisingly bullish for US corn and wheat, with old and new crop carryout estimates of both coming in smaller than trade expectations. Prices of corn and all three wheat crops continued to move higher shortly after the report release. Lean into these continued rallies by making more sales of corn and all three classes of wheat. We were previously at 20% old crop and 10% new crop. Add another increment of 10% to old crop, and 5% to new crop sales. The USDA made some cuts to their South American production estimates, but overall, they cuts were smaller than trade expected. Thus, the USDA continues to lower their South American production estimates at a conservative pace. Corn The USDA cut 100 million bushels from their old crop (2023-24) US carryout estimate, which was 78 million below the average trade estimate. Then the first 2024-25 carryout estimate for US corn came in 182 million bushels less than trade expected. The new crop production estimates begin with assumptions of 90.0 million acres planted and a 181.0 bpa ... December 2024 USDA Supply & Demand Strong corn demand improved the balance sheet beyond expectations Strong demand totals for corn provided a bullish surprise from today’s WASDE report. Ethanol use increased 50 million bushels, and corn exports increased 150 million bushels. With no changes to the supply numbers this month, the 200 million bushel increase to corn demand fell straight to the bottom line, lowering the US corn carryout total from 1.938 to 1.738 billion bushels. The 200 million bushel reduction to US carryout was larger than trade expected and helped corn prices move higher following the report release. We had a 1-Box Sell Signal for corn trigger this morning. Following the favorable USDA supply demand adjustment and the higher price move, we are ready to increase our recommendation on this Sell Signal to 10% of 2024 production. That brings our total recommendation for 2024 corn to 80%. Roach Ag Corn sales recommendations: 2023 – 100% sold 2024 – 80% sold The USDA made no changes to their monthly supply demand table for US soybeans. US wheat carryout declined 20 million bushels this month following a 25 million bushel increase ... June 2024 USDA Supply & Demand Nothing jumped out as a headline in USDA reports The government didn’t change anybody’s mind with their numbers this month. The USDA only made small adjustments to their US and global supply demand numbers this month. The one area trade expected changes, in South American production, they continued to stick to their guns of higher production numbers. The USDA is not ready to follow the private South American estimates lower. We are heading into the important part of the US crop growing season. It is hard to get crops rated much better than 75% good to excellent. Normally crop ratings will only go down from here, but ratings are still expected to be good again this week. Expect choppy trade to continue. USDA US Summary The 2024-25 U.S. corn outlook is unchanged relative to last month. The season average price received by producers remains at $4.40 per bushel. USDA will release its Acreage report on June 28, which will provide survey-based indications of planted and harvested area. The 2024/25 outlook for U.S. soybeans includes higher beginning and ending stocks. Higher beginning stocks ... September 2024 USDA Supply & Demand The changes this month from the USDA were mostly minor adjustments from their August estimates, particularly with soybeans and wheat, which both saw little to no changes from last month. In the end US carryout totals for corn and soybeans both declined this month, while US wheat carryout remained unchanged. For corn, the direction of change was not in line with pre-report trade expectations. While traders forecast the USDA to make cuts to their US corn acreage and yield estimates, the agency left corn harvested acreage unchanged and increased their corn yield estimate half a bushel higher. The result was a US corn production of 15.186 billion bushels, 39 million larger than last month. However, incoming stocks were reduced by 55 million bushels, which canceled out the larger production total and left US 2024-25 new crop corn carryout at 4.586 billion bushels, 16 million smaller than August. Global corn carryout was down from last month but larger than trade expectations. The USDA left US soybean harvested acreage and yield unchanged this month. Beginning stocks were down 5 million bushels and ... 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 February USDA Supply & Demand Small fundamental changes disappoint bullish traders After the USDA released its numbers, prices slid across all crop markets before bouncing 15 minutes later. Kansas City wheat gave us the strongest post-report trade. KC March wheat rallied to new recent highs following the report with traders concerned about dry weather forecast in the western Southern Plains. Chicago and Minneapolis wheat also firmed but are currently trading below recent highs. This month’s 2022-23 U.S. corn outlook forecast lower corn used for ethanol by 25 million bushels. With no other use changes, U.S. corn ending stocks are up 25 million bushels from last month. The USDA lowered US soybean crush by 15 million bushels. With soybean exports unchanged, ending stocks are forecast at 225 million bushels, up 15 million. The 2022-23 U.S. wheat supply and demand numbers were little changed this month, with only minor revisions to domestic use and ending stocks. The global numbers contained no shocks either. Argentine production estimates were smaller than traders expected but were well below the USDA’s January estimates. Source: USDA, Bloomberg Comments are closed.