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USDA adjustments to supply and demand outlooks

The USDA’s latest supply and demand report left old crop ending stocks for corn unchanged, while trimming the outlook on soybeans.

2016/17 corn ending stocks held at 2.370 billion with no changes to the balance sheet, while beans were lowered to 370 million bushels on expectations for strong domestic crush demand. The current marketing year for corn and beans runs through the end of August.

The new crop corn ending stocks estimate was lower than a month ago at 2.273 billion bushels following a lower production guess and a higher feed use outlook. Soybeans were up on the month at 475 million bushels with a bigger production estimate cancelling out an increased export projection. 2017/18 wheat was just about steady with July at 933 million bushels.

The USDA has increased its 2017 beef production estimate to 26.699 million pounds, because of high slaughter rates following bigger placements on feed for most of the year. That increase in production is expected to pressure prices, with the range now at $120 to $122 per hundredweight, while the export guess was lowered because of expected slower demand in the second half of the year.

The pork production estimate was lowered slightly to 25.806 million pounds, with the USDA anticipating a slower third quarter slaughter pace, which could support prices, with a range of $51 to $52.

The broiler chicken production projection was up a little on the month, at 41.488 million pounds, pressuring the price outlook, now at $.93 to $.95 per pound, while the turkey production outlook was lowered to 5.983 million pounds, but the price range was lowered on slow demand expectations, with a new range of $.99 to $1.02.

The USDA lowered its 2017 milk production estimate to 216.3 billion pounds, expecting a decline in the average per cow yield to cancel out a bigger domestic herd. That decline in production is expected to support the all milk price, with the 2017 range now at $17.80 to $18.00, peaking in the fourth quarter. The 2018 milk production guess was also down from July at 220.3 billion pounds.

The average expected prices for cheese and butter were up and nonfat dry milk and dry whey were down, all in response to anticipated demand. The range for butter is now seen at $1.59 to $1.61 per pound, with butter at $2.4245 to $2.465, nonfat dry milk at $.885 to $.905 and dry whey at $.455 to $.475. The 2017 Class III milk price is projected at $15.90 to $16.10 per hundredweight, with Class IV at $15.75 to $16.05.

The next set of USDA supply and demand estimates is out September 12th.

Latest set of USDA supply and demand estimates

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