USDA slashes corn, soy supply view on S. American crop troubles
WASHINGTON - Domestic supplies of corn and soybeans will be tighter than expected in the United States as problems with crops in Brazil and Argentina have raised demand for U.S. supplies from overseas buyers, the U.S. Agriculture Department said ...
WASHINGTON - Domestic supplies of corn and soybeans will be tighter than expected in the United States as problems with crops in Brazil and Argentina have raised demand for U.S. supplies from overseas buyers, the U.S. Agriculture Department said on Friday.
In its monthly supply and demand report, the government cut its new-crop and old-crop ending stocks outlooks for both corn and soybeans by more than analysts had forecast.
Corn and soybean futures surged shortly after the report was released, with the most-active soy contract peaking at $12.08-1/2 a bushel, its highest since June 30, 2014, before retreating to pre-report levels. Investors quickly dialed in increases to U.S. soy plantings in the coming months, expecting farmers to cash in on the price rally.
"I do not think anybody is assuming there are not any more acres coming," said Jim Gerlach, president of A/C Trading in Indian. "I think that's why you saw it jump and then settle back down again. People don't want to jump in with both feet."
For corn, USDA said U.S. ending stocks for 2015/16 would be 1.708 billion bushels, down from its May outlook for 1.803 billion bushels. It lowered its 2016/17 corn end stocks view to 2.008 billion bushels from 2.153 billion bushels.
Old-crop soybean stocks were cut to 370 million bushels from 400 million bushels. New-crop soy stocks were lowered to 260 million bushels from 305 million bushels.
USDA trimmed its 2015/16 Brazil corn harvest outlook by 3.5 million metric tons to 77.50 million metric tons and its Brazil soy harvest outlook by 2 million metric tons to 97 million metric tons, reflecting dryness in key growing areas. The cuts outstripped forecasts.
It left its estimate of Argentine 2015/16 crops unchanged, at 27 million metric tons for corn and 56.5 million metric tons for soybeans, but said that harvest delays there have helped boost U.S. exports.
Wheat supplies are expected to rise to a 29-year high even as the corn and soybean balance sheet tightens.
USDA pegged 2016/17 U.S. wheat ending stocks at 1.050 billion, up from its May outlook of 1.029 billion bushels, due to a record winter wheat yield of 50.5 bushels per acre. The government raised its winter wheat production forecast to 1.507 billion bushels, with bigger harvests expected in states such as Kansas, Oklahoma and Texas.
Old-crop wheat ending stocks were raised to 980 million bushels from 978 million.
Wheat stocks were largely in line with analysts' expectations.