USDA lowers old crop corn, soybean stocks on good demand
USDA tightened the old crop balance sheets for corn and soybeans.
Corn ending stocks were 25 million bushels below last month, with the USDA increasing food, seed, and industrial use expectations. Soybean were down 10 million bushels, with a lower domestic crush guess cancelling out an increased export demand estimate. With less than a month left in its current marketing year, wheat ending stocks were unchanged.
New crop ending stocks projections for corn, soybeans, and wheat were below most pre-report expectations, but do not reflect slower than average corn and soybean planting and recent damage to the winter wheat crop.
The USDA has raised its South American corn and soybean production estimates. While there have been crop weather issues during planting, development, and harvest, overall, conditions have generally been good with solid yields. Bigger crops from Argentina and Brazil have pressured corn and soybean prices and mean more export competition with the U.S. The USDA raised its soybean import estimate for China, the world’s biggest buyer of beans. Tentative early estimates for next marketing year also have big South American corn and bean crops, along with increased soybean import demand from China.
The 2016/17 marketing year runs through the end of May 2017 for wheat, the end of August 2017 for corn and soybeans, and the end of September 2017 for soybean products.
Breakdown of selected supply and demand tables:
2016/17 U.S. wheat ending stocks held at 1.159 billion bushels, compared to 976 million for 2015/16. The USDA raised imports 5 million bushels to 115 million, putting total supply at 3.4 billion bushels, and increased food use 5 million bushels to 955 million, taking domestic demand to 1.206 billion bushels. The average 2016/17 farm price is estimated at 3.90 per bushel, compared to April’s range of $3.80 to $3.90 and the 2015/16 average of $4.89.
2017/18 U.S. wheat ending stocks are seen at 914 million bushels, with an average farm price of $3.85 to $4.65 per bushel. 2016/17 U.S. corn ending stocks are projected at 2.295 billion bushels, compared to 2.320 billion a month ago and 1.737 billion in the previous marketing year. USDA increased the food, seed, & industrial use guess by 25 million bushels to 6.920 billion, for domestic use of 12.420 billion bushels and total use of 14.645 billion. The average 2016/17 farm price is estimated at $3.25 to $3.55 per bushel, unchanged from last month and below last marketing year’s average of $3.61. 2017/18 U.S. corn ending stocks could be 2.110 billion bushels, with production of 14.065 billion bushels and an average yield of 170.7 bushels per acre. The average 2017/18 farm price is estimated at $3.00 to $3.80 per bushel.
2016/17 U.S. soybean ending stocks are pegged at 435 million bushels, compared to 445 million in April and 197 million for 2015/16. Month to month, USDA lowered the crush outlook by 15 million bushels to 1.925 billion, while raising exports 25 million bushels to 2.050 billion, for total use of 4.093 billion bushels. The average 2016/17 farm price is estimated at $9.55 per bushel, compared to $9.40 to $9.70 a month ago and $8.95 in the previous marketing year.
2017/18 U.S. soybean ending stocks are seen at 480 million bushels, with production of 4.255 billion bushels and an average yield of 48.0 bushels per acre. The average 2017/18 farm price is estimated at $8.30 to $10.30 per bushel.
2016/17 world wheat ending stocks came out at 255.35 million tons, up 3.09 million from last month. Global production is estimated at 753.09 million, 1.73 million higher, on increased expectations for wheat growing areas of the Middle East. Domestic feed use is pegged at 147.52 million tons, compared to 146.51 million in April, and exports are seen at 179.74 million tons, compared to 180.68 million a month ago.
2017/18 world wheat ending stocks are projected at 258.29 million tons, with production of 737.83 million, domestic feed use of 138.54 million tons, and exports of 178.35 million.
2016/17 world corn ending stocks are expected to be 223.98 million tons, up less than a million from last month. World production is seen at 1.065 billion tons, 11.35 million higher, thanks to bigger estimates for Argentina, Brazil, and South Africa, all export competitors, along with the European Union. Domestic feed use is estimated at 633.94 million tons, compared to 630.67 million in April, and exports are expected to be 158.58 million tons, compared to 154.41 million a month ago. USDA raised anticipated exports for Argentina and Brazil.
2017/18 world corn ending stocks are projected at 195.27 million tons, with production of 1.034 billion, domestic feed use of 650.86 million tons, and exports of 151.91 million tons.
2016/17 world soybean ending stocks are pegged at 90.14 million tons, compared to 87.41 million in April. Global production is expected to be 348.04 million tons, up 2.07 million, with increased outlooks for Argentina, Brazil, Paraguay, and the European Union. Domestic crush use is estimated at 290.68 million tons, compared to 291.95 million a month ago, and exports are seen at 144.60 million tons, compared to 143.30 million last month. USDA left export estimates unchanged for Argentina and Brazil, while raising the guess slightly for Paraguay. Imports by China were up 1 million tons on the month at 89 million.
2017/18 world soybean ending stocks are projected at 88.81 million tons, with production of 344.68 million, domestic crush use of 301.53 million tons, and exports of 149.56 million.