May 2021 USDA Supply & Demand and Crop Production: Old crop wheat and new crop corn stocks were both bigger than expected.

Following the USDA reports today, wheat prices immediately slid lower. The corn market traded lower for a little bit but quickly began to recover. The bean market immediately recovered some small losses following the report.

As you can see from the following table, wheat was the only crop that had a bigger carryout estimate for 2020-21 compared to trade estimates and last month?s estimates. The USDA old crop corn carryout estimate was slightly smaller than trade expected, while beans were right on target.

For the first estimate of the 2021-22 new crop year, corn ending stocks at 1.507 billion bushels were larger than traders expected. New crop wheat carryout was also bigger than expected with beans right where the traders thought.

The USDA barely changed 2021-21 world ending stocks for corn, beans, and wheat from their April estimates. That left today?s USDA world corn number considerably larger than traders expected. Beans and wheat were close to what was expected.

For next year, the USDA gave us a considerably bigger world ending stocks estimate for corn than traders expected. The USDA world bean number was about 3 million tons larger than expected and wheat was right on the money.

Brazilian corn production was reduced 7 million tons from last month, about 1 million tons less than traders expected. None of the other South American production numbers changed much.

USDA raised U.S. 2021-22 winter wheat production by 46 million tons compared to last month. The current estimate came in right where traders expected, but wheat prices were pressured as soon as the report came out.

Source: USDA, Reuters, StoneX