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11

July USDA Supply & Demand

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Today’s USDA Reports increased corn production by about 200 million bushels due to increased harvested acreage. Bean production was cut about 300 million bushels due to 1.0 bushel per acre smaller yield and smaller harvested acreage.

Old crop corn carryout was increased 145 million bushels due to slower usage. Wheat and bean old crop carryout were reduced slightly.

Carryout for the 2019-20 new crop was increased for corn by 335 million mostly because of increased old crop stocks and increased harvested acreage. Bean stocks were reduced 250 million because of smaller bean acreage and yield estimates.

World wheat carryout for the 2019-20 crop year was reduced nearly 8 million tons from last month. The cut in ending stocks was driven by production cuts across several major wheat producing countries including Russia (-3.8 million tons), the E.U. (-2.5 million tons), Australia (-1.5 million tons), Canada (-1.2 million tons), and Ukraine (-1.0 million tons).

Initially corn and bean prices fell sharply as traders reacted to bigger corn numbers. However, buyers stepped in and quickly took prices higher on the day.

As of right now corn and bean prices are up 2 cents from last night’s close and wheat is up 10. Traders know the USDA yield and acreage numbers are certainly a data point in the spectrum but not very reliable this year. After record late plantings, record rainfall and record flooding, traders are hard to convince.

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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.