Well, as one seasoned broker used to say, post-report: What’s for breakfast?
Corn numbers up
The Oct. 11 WASDE report was sort of a non-event as far as the U.S. 2024-25 balance sheet for corn was concerned.
Harvested acres were left unchanged.
Yield came in 0.3 of a bushel above the trade average.
Production was 30 million above the trade average.
Ending stocks at 1.999 bbu were 11 million above the trade and 58 million below the September WASDE.
The market jumped 4 cents higher at the release but soon traded 1-2 cents lower.
The world numbers were quite a bit more interesting. First, that 800-pound gorilla in the room – China – saw its corn import forecast reduced by 2 MMT to 19 (23.5 MMT LY, unchanged). Most in the trade will argue the USDA is still on the high side.
Offsets included:
1.5 MMT reduction in Black Sea (Russia and Ukraine) exports
600,000 bump on imports for Egypt and Southeast Asia
The USDA sliced into 2023-24 South American corn exports, scaling Argentina back by 3 million bushels and Brazil by 2 million bushels. The net of all these adjustments was to boost 2024-25 U.S. exports by a modest 25 million bushels.
Expected U.S. producer prices are forecast at $4.10, $0.45 below the year just completed. We will watch for potential subsequent yield revisions and wait for more export demand to surface.
Much the same can be said regarding the initial reaction to the soybean Supply & Demand.
Soybean numbers slightly negative
Yield slipped 0.1 from last month to 53.1 bpa and was below the trade average by a like amount. Production fell just 4 million to 4.582 bbu, 1 million more than the trade average.
Ending soybean stocks were pegged at 550 million bushels, 4 million more than the trade and unchanged from last month.
The only adjustment to the demand side was a 2 mbu reduction in the residual component, now at 36 million and 9 million less than in 2023-24. As indicated in the September Stocks report, this was compensated by a similar increase in beginning stocks, leaving forecasted 2024-25 ending inventories at 550 mbu.
Changes to the world numbers were minimal and confined to last year:
South American soybean exports reduced by 930,000.
In contrast, Chinese soybean imports edged up 0.5 MMT to 112 MMT, 3 million more than the 2024-25 forecast, which remains at 109 million.
Overall, I would call the report slightly negative.
Wheat numbers are neutral
After incorporating a slightly smaller carry-in, reduced crop size, and higher imports, the total supply was lowered by 6 million bushels. The only change in usage was a 10 million bushel increase in feed/residual after the recent Grain Stocks report showed higher-than-expected feed/residual use from June through August.
Ending stocks following these changes fell 16 mbu to 0.812 bbu, which was slightly below the average trade guess of 0.820.
Notable changes in world estimates included:
1 MMT reduction in production in Russia, although exports were unchanged.
Crop size in Ukraine increased 0.6 MMT with exports up 1.0 MMT.
Production in the EU was lowered by 1 MMT, with exports reduced by 1.5 MMT.
All classes may see some pressure from unchanged production and export estimates from Australia and Argentina.
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