July USDA Supply & Demand and Crop Production: The biggest USDA surprise is smaller wheat carry out.
Notice the corn and bean yield estimates released today are unchanged from June.
US wheat production came in at 1.746 billion bushels, down 152 million bushels from last month. U.S. winter wheat production was increased by 55 million bushels, while the initial spring wheat estimate was 114 million bushels lower than the average trade estimate.
The 2020-21 carryout in corn was reduced 25 million bushels from the last report, while beans were left unchanged. 2021-22 carryout was increased for corn by 75 million bushels. Soybeans were left unchanged. Wheat carryover was reduced by 105 million bushels.
Bullish traders will be disappointed that the USDA did not give us a substantially tightened supply. But as you can see from the ending stocks graphs below, U.S. supplies are still relatively tight, with little room for new business.
Our Buy Signals in corn and winter wheat have proven to be timely.
Source: USDA, StoneX, Reuters
The USDA estimates the spring wheat yield at 30.7 bushels per acre, down 36.8% from last year.
Source: USDA