Market News

Soybeans, corn, wheat down sharply on USDA numbers

Soybeans were sharply lower on commercial and technical selling. The USDA expects a bigger crop this year than last year, with record acreage cancelling out a lower average yield. USDA lowered old crop ending stocks, while increasing the new crop outlook. USDA did raise the old and new crop export estimates, while lowering the 2016/17 crush, but increasing 2017/18. Soybean meal and oil followed beans lower, despite nominally bullish adjustments to the balance sheets. The USDA says prevented U.S. planted area for beans as of August 1st was 437,000 acres. Brazil’s CONAB now has 2016/17 production in that nation at 114 million tons, up slightly from July and matching the USDA’s current guess. The USDA sees 2017/18 Brazilian soybean production at 107 million tons. The USDA has 2016/17 exports for Brazil at 61 million tons with 2017/18 exports at 64 million. For Argentina, the USDA has 2016/17 production at 57.8 million tons, with exports of 7 million, and 2017/18 production is seen at 57 million tons, with exports of 8 million. 2016/17 soybean imports by China were unchanged at 91 million tons and 2017/18 imports by the world’s biggest buyer are pegged at 94 million tons.

Corn was sharply lower on commercial and technical selling. The crop estimate was down on the month and year, but still more than what many were expecting. Old crop ending stocks were unchanged, while new crop was down, with the lower production estimate cancelling out a decrease in export use. Ethanol futures were lower. 2016/17 U.S. demand for ethanol use is estimated at 5.45 billion tons with 2017/18 at 5.5 billion. The USDA says prevented U.S. corn acreage as of August 1st was 950,000 acres. 2016/17 and 2017/18 world corn ending stocks were up from July. Brazil’s CONAB has 2016/17 corn production at 97.2 million tons, compared to the USDA’s latest guess of 98.5 million. The USDA increased the 2016/17 export guess for corn, while leaving 2017/18 unchanged. The 2016/17 and 2017/18 production and export numbers for Argentina were all unchanged.

The wheat complex was sharply lower on commercial and technical selling, with Minneapolis leading the way down. The winter wheat estimate was up slightly from July and while spring wheat was down, the cut was less than expected. Domestic 2017/18 ending stocks were up slightly on the month. The USDA increased old and new crop world ending stocks projections. The prevented planting estimate for wheat as of August 1st was 614,000 acres. Bahrain bought 25,000 tons of wheat from Australia. Strategie Grains estimates 2016/2017 soft wheat production in the European Union at 141 million tons, compared to the new USDA estimate of 145.70 million.