Prices of corn, soybeans, and wheat immediately turned red as the computer algorithm traders processed the big round of USDA data. Overall, production and carryout totals increased, taking away hope for a bullish surprise from the USDA today. Today’s data will be the standard set of fundamentals traders utilize until the March 31st Stocks update.
Corn
Corn prices took the largest nosedive, following a surprising half bushel increase by the USDA to the US corn yield. The trade estimates were biased to a smaller US corn yield, with no analyst polled by Reuters projecting that the US corn yield could go higher. The USDA is now at 186.5 bpa for US corn. Similarly, analysts were expecting corn acreage to go down, but the USDA increased corn acreage by 211,000 acres. This brought corn production to a record 17+ Billion Bushels.
US corn beginning stocks were slightly larger and total corn use increased by 90 million bushels, leaving a net increase of nearly 200 million bushels to the US corn carryout at 2.227 billion bushels.
Global corn carryout was slightly larger, and the USDA left their South American corn production estimates unchanged again this month.
Soybeans
The USDA left the US soybean yield unchanged at 53.0 bpa, which was just below but in line with trade expectations. Like corn, the USDA increased soybean acreage slightly when trade expected it to go down. The result was a 9 million bushel increase to US soybean production, now at 4.262 billion bushels. Soybean crush increased 15 million bushels, while exports were revised 60 million bushels lower. The result was a 60 million bushel increase in soybean ending stocks to 350 million bushels.
World soybean ending stocks increased by 2 million tons. The USDA left Argentine soybean production steady again this month, while they increased Brazilian soybean production 3 million tons to 178 million tons.
Wheat
US winter wheat seedings totaled 32.990 million acres, which was nearly half a million more than trade expected. December 1st US wheat stocks were at the high end of the trade range. US wheat carryout increased 25 million bushels to 926 million bushels. World wheat carryout increased by 3.4 million tons. Global wheat supplies remain abundant. This took the wind out of the sails of the KC Wheat Sell Signal on its first day.
Source: USDA
Source: USDA, Reuters