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Corn+Soybean Digest

USDA Seen Cutting Soy Carry Again

The United States Department of Agriculture (USDA) is expected to cut its estimate of the 2008-2009 soybean carryout further with Tuesday’s monthly supply/demand update, which will also contain the department’s first monthly estimates of 2009-2010 supply/demand conditions.

Trade estimates of the 2008-2009 U.S. soybean ending stocks average only 130 million bushels in a range from 86-148 million bushels, compared with USDA’s April estimate of 165 million bushels.

U.S. soybean stocks are expected to come down because of continued strong export demand, mainly from China, and a further reduction in Argentina’s expected crop. USDA could cut Argentine production and world soybean stocks by another 4-5 million metric tons.

The grain trade expects only minor changes in USDA’s old-crop corn and wheat carryout estimates.

Trade estimates of 2008-2009 corn ending stocks average 1.711 billion bushels compared with USDA’s April estimate of 1.7 billion bushels, while estimate of the old-crop wheat carryout average 687 million bushels against USDA’s April estimate of 696 million bushels.

USDA is expected to forecast a modest rise in U.S. soybean ending stocks for 2009-2010, but project lower corn and wheat stocks.

Trade estimates of the 2009-2010 U.S. soybean carryout average 239 million bushels in a wide range from 148 million to 528 million bushels.

Stocks are expected to rise due to large production with U.S. soybean planting intentions at a record 76 million bushels.

Estimates of the 2009-2010 corn carryout average 1.383 billion bushels, down 317 million bushels from the current old-crop carryout. Estimates range from 1.129 billion to 1.720 billion bushels.

A moderate recovery in corn demand is anticipated next year and production is seen falling due to smaller planted acreage.

Prereport estimates of the 2009-2010 U.S. wheat carryout average 653 million bushels in a range from 570 million to 742 million bushels.

A further slowdown in demand for U.S. wheat is expected to partially offset a significant drop in U.S. production resulting from lower U.S. planted acreage and winter wheat crop problems in the southern Plains.

Editor’s note: Richard Brock, Corn & Soybean Digest's marketing editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

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