CHICAGO, Feb 8 (Reuters) - U.S. corn and soybean supplies will be bigger than previously expected due to weaker domestic demand, the government said on Wednesday, Feb. 8.
The government also lowered its forecast for corn and soybean harvests in key global supplier Argentina, which has suffered through a drought through much of the growing season, but the cuts were smaller than other recent estimates.
U.S. stocks still remain relatively tight, with corn supplies pegged at a nine-year low and soybeans at a seven-year low. The Argentina forecasts have cast doubt on crop availability elsewhere in the world.
"The focus was on Argentine production and, as expected, USDA was conservative," said Don Roose, president of U.S. Commodities. "We've seen lower numbers than this."
Soybean and corn futures briefly turned lower after the report was released before returning to positive territory.
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The U.S. corn stockpile at the end of the 2022-23 marketing year would likely come in at 1.267 billion bushels, the U.S. Agriculture Department said in its monthly World Agricultural Supply and Demand Estimates report. That was 25 million bushels higher than a month ago and came from a reduction in corn used for ethanol.
Soybean end stocks were seen at 225 million bushels, up 15 million bushels from the January outlook due to a slower pace of crushing at processing plants in December following unusually harsh weather.
Analysts had been expecting the report to show U.S. corn stocks of 1.266 billion bushels and soybean stocks of 211 million bushels, according to the average of estimates given in a Reuters poll.
Soybean harvest in Argentina, the world's third-biggest producer of the oilseed, will fall to 41 million metric tons, down from 45.50 million metric tons estimated in January, USDA said. The country's corn harvest was pegged at 47 million metric tons, 5 million lower than the January outlook.
(Reporting by Mark Weinraub in Chicago. Additional reporting by Karl Plume in Chicago. Editing by Matthew Lewis)
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