The November World Agriculture Supply and Demand Estimates held some bullish surprises for both corn and soybeans.
The U.S. Department of Agriculture lowered soybean yield by 1.2 bushels per acre from October to 50.7 bushels per acre. Production dropped by 98 million bushels to 4.17 billion bushels and that dropped ending stocks by 100 million bushels to only 190 million bushels. Another surprise was USDA left crush and exports unchanged from last month.
Jim McCormick with Agmarket.net says he thinks those figures will have to be increased by the January report, which could put soybean ending stocks to near pipeline supplies. He says this will continue to support soybean prices.
“Soybean futures have been above $11 and making contract highs and so the next target is $12,” he said.
The agency lowered world soybean ending stocks by 2.2 million metric tons to 86.5 million metric tons from October due to the lower U.S. production figure.
The other bullish surprise came in the corn balance sheet as USDA lowered yield 2.6 bushels per acre to 175.8 bushels per acre, and that helped pull production down 215 million bushels to 14.507 billion bushels. Ending stocks saw a sharp drop of 465 million bushels from October to 1.702 billion bushels. That adjustment came not just on the lower production figures, but USDA raised corn exports 325 million bushels with recent buying from Mexico and China.
“This should help keep a bid under the corn market,” McCormick said.
World carryout was lowered by over 9 million metric tons to 291.4 million metric tons.
Domestic ending stocks for wheat were adjusted down by only 6 million bushels to 877 million bushels, while world ending stocks were lowered by just 1 million metric tons to 320.5 million metric tons. World production was only slightly lower at 772.4 million metric tons, which was a bit surprising with the dry conditions in areas of the Black Sea and Argentina. McCormick expects wheat to continue to be a follower of the row crop sector, but especially corn.