Entering the Wednesday trade on a generally positive note. There are some comments out of Japan regarding their economy and future power sources which seems to be distracting the markets from the nuclear issues. Grain markets will remain volatile ahead, and likely after, tomorrow’s USDA report, which is shaping up to be one of the most important in modern time.
Tag Archives: USDA
Video: Early Update – 2011.03.28
Global equity markets have a slightly positive tone to start the week. This is a little surprising in light of Germany’s ruling party being dealt a political setback, and the uncertainty in Japan. Important USDA report due out this week which will influence the grain markets. Rebels in Libya are attempting to negotiate the sale of some oil.
USDA Supply Demand Review: Corn and Soybean Slighly Negative; Wheat Negative
CORN
The USDA report this morning was considered neutral to slightly negative with the market called 4-6 cents lower on the opening. US ending stocks were pegged at 675 million bushels, unchanged from last month. Going into the report there were expectations for a small decline. Total usage numbers were left unchanged. This results in a stocks/usage ratio of 5%, which matches the record low set in the 1995/96 season. World ending stocks came in at 123.14 million tonnes, up from 122.5 million last month but still below the 144.54 million for last year. Argentina’s production was left unchanged, but Brazil’s was revised higher by 2 million tonnes to 53 million.
WHEAT
The USDA supply/demand report this morning was considered bearish for wheat with the market called 8-10 cents lower on the opening. US ending stocks came in at 843 million bushels, which was up from 818 million last month and compares with 976 million for last year. Traders had expected to see a slight revision lower of 5-10 million bushels. The USDA lowered US exports by 25 million bushels. For the world report, ending stocks were pegged at 181.90 million tonnes, up from 177.77 million tonnes reported last month and compared with 197.6 million tonnes last year. Argentina and Australia production was revised higher.
SOY COMPLEX
The USDA Supply/demand report was considered neutral to slightly negative with the market called 10-15 cents lower on the opening. US ending stocks were pegged at 140 million bushels, which was unchanged from last month. Traders had expected a small increase of a few million bushels. This is still the lowest ending stocks level since the 2008/09 season. The stocks/usage ratio is now the lowest since the 1965/66 season. World ending stocks were pegged at 58.33 million tonnes, up from 58.21 million last month but still down from 59 million tonnes for last year. Argentina’s production was left unchanged and Brazil’s was revised higher by 1.50 million tonnes to 70.00 million.
USDA Supply & Demand Review – 2010.09.10
Soybeans
The USDA Supply/Demand Report this morning was considered bearish against expectations with the market called 2-3 cents lower on the open. The USDA pegged average yield at 44.7 bushels per acre compared to 44 bushels per acre last month. This pushed soybean production to 3.483 billion bushels versus trade expectations near 3.400 billion and last month’s USDA estimate of 3.433 billion. Old crop ending stocks were pegged at 150 million bushels from 160 million last month, and ending stocks for the 2010/11 season were pegged at 350 million bushels compared with trade expectations for 285 million and with 360 million bushels posted last month by the USDA. World ending stocks for the 2010/11 season are pegged at 63.61 million tonnes from 64.73 million tonnes last month and 62.85 million last year. Stocks were just 43.97 million two years ago. While down from last month, this is still the highest world ending stocks on record. China’s import demand was revised higher by 3 million tonnes to a record 55 million tonnes compared with 50 million tonnes last year and 41.1 million two years ago.
PRICE OUTLOOK: Strong demand from China with another revision higher of 3 million tonnes in imports for this year to a record 55 million helped to hold down the world ending stocks estimate to just above last year and two years ago, but it is still a record. Record yield in the US and a jump in ending stocks are seen as negative forces, but corn numbers were supportive, which should help soybeans avoid a significant collapse. Resistance for November soybeans is at 1050 with 1032 3/4 and 1025 1/4 as support. Look for lower trade into the harvest.
Corn
The USDA Supply/Demand Report this morning was considered neutral to supportive against expectations with the market called to open 3 cents higher. Average yield was pegged at 162.5 bushels per acre as compared with trade estimates near 163 bushels per acre and 165 by the USDA last month. This pushed corn production down to 13.160 billion bushels as compared with trade expectations near 13.200 billion and down 205 million bushels from last month (13.365 billion bushels). The USDA pegged 2010/11 corn ending stocks at 1.116 billion bushels compared with trade expectations near 1.110 billion and last month’s USDA estimate of 1.312 billion bushels. This results in a stocks/usage number of 8.3%. This ratio has been under 10% just two other times since 1973. World corn ending stocks were revised down by about 3.6 million tonnes from last month to 135.56 million tonnes. China production was left unchanged at 166 million tonnes. Of more concern could be the revision down in world coarse grain ending stocks to just 166 million tonnes as compared with 172 million tonnes last month, 180 million in July, 187 million last year and 193.8 million two years ago. This opens the door for further revisions higher in corn exports from the US in coming months. US Corn exports were revised higher by 50 million bushels this month to 2.1 billion bushels from 2.05 billion last month and 1.98 billion last year. Feed usage was revised down by 100 million bushels to 5.25 billion bushels from 5.35 billion last month.
PRICE OUTLOOK: The report was mostly neutral against expectations, but there is the possibility for many bullish revisions in the months ahead. Traders see export and feed usage numbers as possibly too low, and traders also see the yield estimate coming down in future reports. The 8.3% stocks to usage ratio is already the tightest since the 1994/95 season and the second tightest since 1973. Keep 480 and 493 as the next upside objectives for December corn, and don’t rule out 550-600 if yield comes down in the October report.
Wheat
The USDA’s Supply and Demand report for wheat was considered slightly negative for wheat with the opening call 3-5 cents lower. Domestic numbers were on the supportive side with the only changes in US all-wheat totals being a 50 million bushel increase in exports and a corresponding 50 million bushel decrease in 2010/11 ending stocks. This took US exports up to 1.250 billion bushels with ending stocks falling to 902 million. Soft red winter wheat ending stocks were left unchanged at 179 million. Hard red winter stocks were lowered to 349 million from 379 last month while hard red spring stocks were lowered to 249 from 259. The world numbers were negative with 2010/11 beginning stocks up by 2 million tonnes and overall production down by just 2.72 million tonnes to 643.01 million. The total world usage number was lowered by about 1 1/2 million tonnes and this resulted in an unexpected increase in world ending stocks to 177.79 million tonnes from 174.76 in August. This is well up from 125 million posted just a few years ago. Russian production was lowered by another 2 1/2 million tonnes to 42.5 million while Ukraine and Kazakhstan were left unchanged. Pakistan was also left unchanged despite the loss of wheat seed in the recent floods. India, China, Argentina and Australia were left unchanged. Canada was raised by 2 million tonnes to 22.5 million and the EU was lowered to 135.13 from 137.51 last month due to lower production in Germany.
PRICE OUTLOOK: Prices have remained in a sideways pattern for the past month with a possible upward bias developing over the past several days. This is not a typical pattern following a major top and that may mean that further gains are possible if importers and funds keep buying. However, given the adequate world supply levels, a further boost may depend on increased stockpiling by major importers with poor populations. India continues to sit on large wheat reserves, but India may be hesitant to make a major push into the export market out of fears that this will increase food price uncertainty on the domestic front. A resumption of the downtrend leaves key support at 670 1/2 and 623 3/4 for December wheat.
USDA Export Sales Review – 2008.11.14
CORN:
Net weekly export sales for corn, came in at 355,500 metric tonnes for the current marketing year and 2,300 for the next marketing year for a total of 357,800.
Cumulative corn sales stand at 36.2% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 40.3%. Sales of 720,000 metric tonnes are needed each week to reach the USDA forecast.
WHEAT:
Net weekly export sales for wheat, came in at 248,300 metric tonnes for the current marketing year and 5,000 for the next marketing year for a total of 253,300.
As of November 6, cumulative wheat sales stand at 71.5% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 62.8%. Sales of 264,000 metric tonnes are needed each week to reach the USDA forecast.
SOY COMPLEX:
Net weekly export sales for soybeans came in at 478,300 metric tonnes for the current marketing year and none for the next marketing year for a total of 478,300.
As of November 6, cumulative soybean sales stand at 56.3% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 51.6%. Sales of 284,000 metric tonnes are needed each week to reach the USDA forecast.
Net meal sales came in at 124,400 metric tonnes. Cumulative soybean meal sales stand at 33.0% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 36.9%. Sales of 112,000 metric tonnes are needed each week to reach the USDA forecast.
Net oil sales came in at 6,300 metric tonnes. Cumulative soybean oil sales stand at 17.2% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 24.4%. Sales of 18,000 metric tonnes are needed each week to reach the USDA forecast.
COTTON:
Net weekly export sales for cotton, came in at 134,000 running bales for the current marketing year and none for the next marketing year for a total of 134,000.
As of November 6, cumulative cotton sales stand at 56.5% of the USDA forecast for 2008/2009 (current) marketing year versus a 5 year average of 48.1%. Sales of 138,000 running bales are needed each week to reach the USDA forecast.
USDA Supply/Demand & Crop Production Review – 2008.11.10
CORN:
The USDA’s Crop Production and Supply/Demand report was considered mostly neutral this morning with corn called 5-10 cents higher on the open. The USDA pegged corn production at 12.020 billion bushels which was about 55 million bushels below trade expectations and compares with 12.033 billion posted in the October 28th update. Yield was revised down to 158.3 bushels/acre from 153.9 last but the trade expected a higher number. Ending stocks were pegged at 1.124 billion bushels from 1.088 billion last month but this was still about 65 million bushels below trade expectations. Exports were revised lower by 50 million bushels and domestic usage left unchanged. World numbers were somewhat negative as world usage was revised lower by about 2.5 million tonnes and beginning stocks were revised higher. As a result, ending stocks are now pegged at 110.12 million tonnes from 105.57 million last month and 126.47 million last year.
WHEAT:
The USDA’s Supply/Demand revisions this morning were considered neutral to slightly negative in wheat with the market called unchanged to 7 cents higher. US ending stocks were raised to 603 million bushels from 601 last month. Traders were expecting a drop of about 15 million bushels. Yield and production were left unchanged as expected and usage numbers were also unchanged with the exception of ‘seed’ which was lowered by 2 million. On the world S&D report, Argentine production was lowered 1.0 million tonnes to 11.00 million, Australia was lowered 1.5 million tonnes to 20.0 million. This was about as expected. However, the EU wheat crop was raised to 150.6 million from 147.17 on the October report which left world production about 2.2 million tonnes higher than last month. World trade was raised to 121.83 million tonnes from 120.83 million last month.
SOY COMPLEX:
The USDA’s Crop Production and Supply/Demand Reports were considered neutral for soybeans with the market called 20-25 higher. The USDA pegged soybean production at 2.921 billion bushels which was about as expected and is down 17 million bushels from the last update. Yield was revised down to 39.3 bushels per acre from 39.5 last month. Traders expected a drop of about 10 million bushels in ending stocks but the USDA left ending stocks unchanged from last month at 205 million bushels. Crush was revised lower by 15 million bushels. World numbers were somewhat supportive with Brazil production down to 60 million tonnes from 62.5 million posted in October. As a result, ending stocks are now pegged at 54.06 million tonnes from 54.34 million last month and 53.04 million last year.
USDA October 28 Revision to US Supply / Demand
CORN: The USDA’s Crop Production and Supply/Demand revisions this morning were considered supportive to the market with corn called 20-25 cents higher. The USDA revised planted and harvested acres down by 1 million acres. Yield was revised down.10 to 153.9 bushels/acre. This pushed production down to 12.033 billion bushels, down 167 million bushels from the original forecast. However, the USDA also lowered feed usage by 50 million and export demand by 50 million bushels. Ending stocks are now pegged at 1.088 billion bushels from 1.154 billion last month. This leaves stocks/usage at 8.6% from 9.1% in the original October forecast and is seen as supportive.
WHEAT: There were no revisions to the October 10, 2008 Supply/Demand Report today.
SOY COMPLEX: The USDA issued a corrected Supply/Demand Report for soybeans today. It was considered bullish and soybeans are called 50 cents higher to limit up. The estimate of soybean harvested acreage was revised to 74.4 million acres, down 1.1 million from the original October report. Yield was left unchanged, but the lower acreage resulted in a lower production estimate at 2.938 billion bushels compared to 2.983 on the original report. Ending stocks were lowered to 205 million bushels compared to 220 on the original report. With the crush number left unchanged, meal and oil S&D numbers were all left unchanged. Soybean exports were revised lower by 30 million bushels to 1.02 billion bushels.
USDA Supply / Demand and Crop Production Summary
SOYBEANS
The USDA’s Crop Production and Supply/Demand Report this morning was considered somewhat bullish for soybeans with the early opening calls at 25-30 higher based in part on the lower dollar and strong action in the soybean complex overnight. The USDA pegged the US soybean yield at 40 bushels per acre compared to 40.5 bushels per acre on the August report. This lowers the US soybean crop to 2.934 billion bushels compared with 2.973 billion bushels last month and 2.585 billion bushels last year. Ending stocks were left unchanged at 135 million bushels while beginning stocks were raised 5 million to 140 million bushels. Traders expected ending stocks near 145 million. While the USDA revised crop production lower by 39 million bushels, demand was also revised lower with the crush down 30 million. World ending stocks were adjusted higher to 51.23 million tonnes from 49.28 million last month as Argentina production was revised 1 million tonnes higher and beginning stocks were higher. China import demand was left unchanged at 36 million tonnes despite the adjustment higher in production.
CORN
The report this morning was considered supportive this morning with the market called 7-10 higher. The corn yield was put at 152.3 bu/acre compared to 155.0 bushels per acre on the August report and a trend line yield of 154.9. This pushed production to 12.072 billion bushels, down 216 million bushels from last month. Usage was revised lower by 100 million bushels due to an adjustment lower for feed. This put corn ending stocks at 1.018 billion bushels as compared to 1.133 billion bushels in August and 1.576 billion last year. This is a stocks/usage of 8.1% which is the second lowest in history behind 95/95. World ending stocks were pegged at just 109.9 million tonnes as compared with 112.4 million last month and 123.5 million tonnes last year. This is very tight.
WHEAT
The report this morning was neutral for wheat and the opening call is 8-12 cents higher based on outside markets and bullish overnight action in wheat. The USDA left production, usage and ending stocks levels. This leaves ending stocks at a moderate 574 million bushels. This also leaves the US stocks/usage ratio unchanged at 25.0% compared to 13.1% for 2007-08. World wheat production for 2008-09 came in at 676.28 compared to 670.75 million tonnes on the August report. This was mostly in line with recent trade estimates. Australian production was lowered to 22.0 million tonnes from 25.0 million tonnes last month in line with recent private forecasts. Argentina was lowered to 12.5 million tonnes compared to 13.5 last month. This was also about as expected. The EU wheat crop was raised to 147.19 million tonnes from 143.17 last month and this was also in line with recent trade and governmental updates in Europe. Canadian production was raised slightly and China production was left unchanged.
USDA Export Inspections
Weekly export inspections for soybeans came in at 7.429 million bushels. As of August 28, cumulative soybean export inspections for the 07-08 marketing year have reached 97.2% of the USDA forecast versus a 5 year average of 97.9%. Inspections of 32.521 million bushels are needed each week to reach the USDA forecast.
Corn came in at 33.099 million bushels. Cumulative corn export inspections for the 07-08 marketing year have reached 96.0% of the USDA forecast versus a 5 year average of 94.3%. Inspections of 341.0 million bushels are needed each week to reach the USDA forecast.
Wheat came in at 30.152 million bushels. Cumulative wheat export inspections for the 08-09 marketing year have reached 32.3% of the USDA forecast versus a 5 year average of 23.4%. Inspections of 17.0 million bushels are needed each week to reach the USDA forecast.
USDA Supply Demand and Grains Stocks Review
by Terry Roggensack on January 12, 2011
Corn
The USDA reports this morning were considered bullish with the market called 10-15 higher on the opening. The key number which traders were waiting for was the December 1st stocks. December 1st stocks came in at 10.040 billion bushels which was down 27 million from trade expectations and down 862 million bushels from last year. There was a very wide range of expectations of near 1.3 billion bushels for this number so the actual news was considered slightly supportive. This compares with December 2009 stocks of 10.902 billion bushels. For the final crop production report of the season, the USDA pegged production at 12.447 billion bushels with a yield of 152.8 bushels/acre as compared with the previous estimates of 12.54 billion with a yield of 154.3.
For the supply/demand update, US ending stocks were revised lower to 745 million bushels as compared with 832 million bushels last month and trade expectations near 780 million. Total usage numbers were left unchanged with ethanol usage up 100 million bushels and feed usage down 100 million. World ending stocks came in at 127 million tonnes as compared with trade expectations near 127.5 million and 130 million last month. Argentina production was revised down by just 1.5 million tonnes to 23.5 million tonnes and many traders have already pushed their estimates lower.
The report is considered supportive against expectations. March corn could see some light resistance at 618 1/4 with 648 1/2 as next upside objective. The report would suggest that some price rationing may be in order and that the trend should remain up.
Soybeans
The USDA reports this morning were considered supportive with the market called 15-20 cents higher on the opening. For the Supply/Demand report, US ending stocks were pegged at 140 million bushels as compared with 165 million last month and 151 million last year. This is the lowest ending stocks since the 2008/09 season. The stocks/usage is now the lowest since the 1965/66 season. World ending stocks were pegged at 58.28 million tonnes as compared with 60.12 million tonnes last month and trade expectations near 58.5 million. Argentina production was pegged at 50.50 mmt vs. 52 million tonnes last month.
For the final crop production report of the year, the USDA pegged soybean production at 3.329 million bushels with a yield of 43.5. Traders were looking for a slight decline from the previous production estimate of 3.375 billion bushels. Production was down 46 million bushels from the last forecast and down 44 million from trade expectations. Planted area was revised lower by 300,000 acres. December 1st stocks were pegged at 2.277 billion bushels as compared with 2.339 billion one year previous. Traders were looking for a slight rise from last year so the 62 million bushels decline is considered supportive.
The news is bullish and US exports were left unchanged so there is further tightening possibilities ahead “if” exports need to be revised higher. In addition, Argentina production is pegged at 50.5 million tonnes with plenty of traders seeing 44-48 million. March soybeans could encounter some resistance at the 1382-1388 1/2 zone with 1429 1/2 as next objective.
Wheat
The USDA reports this morning are considered supportive for wheat with the market called 8-12 cents higher on the opening. Traders were keying in on the winter wheat plantings report which showed total plantings at 40.99 million acres as compared with trade expectations near 40.94 million acres and just 37.335 million last year. Hard red winter wheat plantings came in at 29.60 million acres vs. expectations near 30.2 million so the report is “more” supportive to Kansas City wheat as compared with Chicago. Soft red winter was 7.76 million acres as compared with expectations near 7.2 million and just 5.27 million last year.
For the supply/demand report, US ending stocks came in at just 818 million bushels compared with expectations near 850 million and 858 million last month. Ending stocks were 976 million last year. For the world report, ending stocks were pegged at 177.99 million tonnes as compared with 176.72 million tonnes last month and trade expectations near 174.6 million. Argentina production was revised higher and Australia was left unchanged. December 1st stocks came in at 1.928 billion bushels as compared with expectations near 1.94 billion bushels and 1.782 billion bushels last year at this time.
The report is considered supportive with tightening ending stocks, higher US exports and smaller than expected hard red winter wheat plantings. The world report was slightly negative. May KC wheat may see some resistance near the 868 1/4 to 873 1/2 zone with 906 as next upside objective. March wheat might bounce to at least the 791 to 799 zone.