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10

January USDA Supply & Demand

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In today’s major USDA supply and demand report, most traders were surprised by larger corn feed demand numbers, up 100 million bushels and ethanol by another 50 million bushels.  Corn ending stocks were reduced to 1.631 billion bushels from December report at 1.792 billion bushels.  The trade guess average was too high by 224 million bushels or 12%! To tighten stocks further, final corn yield numbers were reduced to 158.8 bu/acre.  Our position has been current corn values are cheap enough to support a more aggressive demand outlook than previous.  Today’s report confirms our viewpoints. 

Soybean production numbers were increased 31 million bushels to 3.289 billion. As expected, demand numbers were adjusted higher by nearly the same number leaving ending stocks unchanged at 150 million bushels. With soybean ending stocks just 9 million bushels above last year, we can expect a tight soy market on into summer. U.S. buyers will look for cheaper Brazilian soybean supplies when they become available later in March. Until then, U.S. buyers will be hard pressed to get enough coverage with this report in the rearview mirror.

Wheat ending stocks were adjust upward by 33 million bushels on higher exports offset by a 60 million bushel decline in fee/residual forecasts. 

World supplies of corn decreased 2.23 million tons on smaller U.S. production and ending stock estimates offset by a larger China corn production forecast. Chinese corn production increased a large 6 million tons and at the same time, Chinese corn imports were reduced from 7 million tons to 5 million tons.

World supplies of soybeans were increased 1.71 million tons to 72.33 million tons. Rising production in Brazil (+1 million tons) was the only adjustment higher in S. America. U.S. producers need to be aware of new supplies soon to become available from eager Brazilian exporters in March. Unlike last year, plentiful new soybean supplies could stifle the need to buy higher priced domestic supplies from U.S. producers.


World wheat ending stocks increased to 2.62 million tons on higher beginning inventory and world production in China and the FSU offset by slightly rising export imports. Wheat supplies have increased 9.27 million tons from last year.


2013-14 USDA U.S. Grain Yield
(bu/acre)

 

USDA Jan 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Dec 2013-14

Corn

158.8

161.1

159.8-163.3

160.4

Soybeans

43.3

43.3

42.5-43.8

43.0

Wheat

47.2

 

 

47.2


2013-14 USDA U.S. Grain Production
(bln bu)

 

USDA Jan 2013-14

Average Trade Est.

Range of
Trade Est.

USDA Dec 2013-14

Corn

13.925

14.060

13.897-14.255

13.989

Soybeans

3.289

3.278

3.217-3.330

3.258

Wheat

2.130

 

 

2.130


2013-14 USDA U.S. Grain Carryout
(bln bu)

 

USDA Jan 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Dec 2013-14

Corn

1.631

1.855

1.654-2.054

1.792

Soybeans

0.150

0.153

0.118-0.204

0.150

Wheat

0.608

0.563

0.460-0.588

0.575


2013-14 USDA World Grain Carryout
(mln tons)

 

USDA Jan 2013-14

Average
Trade Est.

Range of
Trade Est.

USDA Dec 2013-14

Corn

 160.23

163.08

160.0-165.15

162.46

Soybeans

 72.33

71.46

70.85-72.50

70.62

Wheat

185.40

182.68

181.0-184.0

182.78


2013-14 USDA Quarterly Grain Stocks
(bln bu)

 

USDA
Dec 1 2013

Average
Trade Est.

Range of
Trade Est.

USDA
Dec 1 2012

Corn

 10.426

10.764

10.025-11.250

8.033

Soybeans

 2.148

2.158

2.006-2.266

1.966

Wheat

1.463

1.417

1.305-1.768

1.671


2014 USDA Winter Wheat Seedings
(million acres)

 

USDA
2014-15

Average
Trade Est.

Range of
Trade Est.

USDA
2013-14

All Winter

 41.892

43.531

42.50-44.50

43.09

Hard Red

30.10

30.45

29.40-31.90

29.57

Soft Red

8.44

9.561

8.25-10.33

10.02

White

3.39

3.526

3.37-3.75

3.50


Source: USDA WASDE



Categories: | Tags: WASDE , Supply & Demand , USDA Report | View Count: (5790) | Return
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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.