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March USDA Supply & Demand

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Today’s mid-day release of the latest supply/demand number pegged corn ending stocks at 1.456 Billion bushels, within the trade guess range. Soybean ending stocks were reported at 145 million bushels, slightly higher than the average trade guess but well within the range. I think it is as much Chinese cargo cancellations from Brazil that has the oilseed complex lower early this afternoon. The USDA also chose to raise soybean imports (+5 million bu), suggesting they see price advantages coming to U.S. coastal buyers at some point this marketing season.

Wheat markets remain firm on no changes to ending stock estimates while Ukraine and Black Sea worries will keep values firm. The USDA chose to leave U.S. wheat demand unchanged while typically leaving supply number alone until the May report.

Here is what the USDA had to say about each of the grains and oilseed:

Corn

Projected U.S. feed grain ending stocks for 2013/14 are reduced with higher corn exports and lower oats imports. Corn exports are projected 25 million bushels higher on stronger world imports and the rising pace of shipments in recent weeks. Continued strong export sales also support the higher figure. Projected corn ending stocks are lowered 25 million bushels. Oats imports are projected 10 million bushels lower as Canadian logistical problems reduce the availability of importable supplies. Small reductions in U.S. oats domestic use and ending stocks are projected. The season-average farm price for corn is narrowed 5 cents on both ends of the projected range to $4.25 to $4.75 per bushel.

Soybeans and Meal
U.S. soybean supply and use projections for 2013/14 include higher imports and exports, reduced crush, and reduced ending stocks compared with last month’s report. Soybean exports are raised 20 million bushels to a record 1.53 billion reflecting continued strong sales and shipments through February. Soybean crush is reduced 10 million bushels to 1.69 billion reflecting weaker-than-expected domestic soybean meal use through the first quarter of the marketing year. Soybean stocks are projected at 145 million bushels, down 5 million from last month.

Soybean and soybean product prices are all projected higher this month. The season-average price range forecast for soybeans is raised 25 cents on both ends of the range to $12.20 to $13.70 per bushel. Soybean oil prices are forecast at 36 to 39 cents per pound, up 1.5 cents at the midpoint. Soybean meal prices are projected at $450 to $490 per short ton, up 25 dollars at the midpoint.

Wheat
There are no changes to the 2013/14 U.S. all wheat supply and use projections this month. A 15-million-bushel increase in projected Hard Red Spring wheat exports is offset by a decrease for Soft Red Winter wheat, with both changes reflecting the pace of sales and shipments. Projected ending stocks for both classes are adjusted accordingly. The projected season-average farm price for all wheat is raised 10 cents on the bottom end of the range to $6.75 to $6.95 per bushel based on recent strength in prices.

Global 2013/14 wheat supplies are raised slightly with a 0.8-million-ton increase in world production. Production is raised 1.1 million tons for India and 0.5 million tons for Australia based on the latest government reports. China is lowered 0.3 million tons, also based on the latest official indications. Production is lowered for Uruguay and Paraguay, down 0.3 million tons and 0.2 million tons, respectively, reflecting dry growing season conditions in both countries and early season freeze damage in Paraguay that also reduced yields.

2013-14 USDA U.S. Grain Carryout
(billion bushels)

 

USDA Mar 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Feb 2013-14

Corn

1.456

1.488

1.431-1.656

1.481

Soybeans

0.145

0.141

0.130-0.150

0.150

Wheat

 0.558

0.570

0.549-0.615

0.558


2013-14 USDA South American Production
(million tons)

 

USDA Mar 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Feb
2013-14

ARG

Corn

 24.00

23.35

20.8-24.0

24.0

Soybeans

 54.00

53.50

52.7-54.0

54.0

BRZ

Corn

 70.00

69.03

64.5-70.5

70.0

Soybeans
88.50
88.14 86.5-90.0
90.0

2013-14 USDA World Grain Carryout
(million tons)

 

USDA Mar 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Feb 2013-14

Corn

 158.47

156.27

154.8-158.4

157.30

Soybeans

 70.64

71.46

69.5-72.9

73.01

Wheat

 183.81

183.65

182.1-185.0

183.73


Source: USDA WASDE, Bloomberg, Reuters



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These data and comments are provided for information purposes only and are not intended to be used for specific trading strategies. This commentary is written as a daily marketing tool to help farmers sell the grain they raise. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. Past performance and testimonials are not necessarily indicative of future results. Commodity trading involves the risk of loss, and you should fully understand those risks before trading.