Market News

USDA numbers support soybeans

Soybeans were higher on commercial and technical buying. The USDA did confirm record U.S. production and yield last year, but both were below the average pre-report estimate. Quarterly and ending stocks were down more than expected. Soybean meal and oil followed beans higher. USDA raised 2016/17 soybean oil ending stocks on a bigger production guess while leading biodiesel use unchanged. The average price is seen at $.34 to $.37 per pound. Soybean meal stocks held at 300,000 short tons with lower production and lower exports cancelling each other out. The average price is estimated at $305 to $345 per short ton. USDA lowered 2016/17 global ending stocks and production slightly. The crop for Argentina was left at 57 million tons and Brazil was raised 2 million to 104 million. Imports by China held at 86 million tons. USDA did increase Brazil’s export outlook.

Corn was higher on commercial and technical buying, along with spillover from beans and wheat. The USDA made last year’s record U.S. crop and yield official and quarterly stocks were up more than expected. U.S. ending stocks were down on the month. Ethanol futures were lower. 2016/17 global corn stocks and production were down from December with no changes to production or exports for the primary U.S. export competitors.

The wheat complex was higher on commercial and technical buying. The USDA’s winter wheat acreage estimate was less than expected, with a 10% year to year decline. The fundamentals remain bearish, especially on the supply side, but wheat’s still reluctant to sell-off too much further, even with another round of confirmation by USDA. 2016/17 world wheat ending stocks and production were up on the month with the USDA raising production projections for Argentina, Russia, and the European Union. Exports were higher as well.