Acres and Grain Stocks report shows record soybean crop | Ohio Ag …
Never miss the latest news affecting Ohio agriculture. Subscribe to Digital Dale and follow along via Facebook and Twitter.
Today’s reports were bearish for corn, soybeans, and wheat. Soybean acres were estimated at 84.8 million acres, 2.6 million acres above the trade estimate. Soybean stocks were estimated at 405 million bushels. The average trade estimate was 378 million bushels. Corn acres were pegged by USDA at 91.6 million acres, a neutral number. However corn stocks were 100 million bushels above trade estimates. The previous two corn stocks reports have missed trader estimates by 200 million bushels or more. Wheat acres at 56.5 million acres were above trade estimates at 55.8 million acres.
Two obvious things stand out with these numbers. First, with soybean stocks higher than expected it continues to give support to ideas that the 2013 soybean production number will be revised upward later this fall. For months the market has talked that soybeans are tight with the big number of imports that came into the US the past four months. However soybean basis levels have are below levels of last year in recent months by 20-50 cents. This fact has lent huge support to ideas the 2013 soybean production is too low. Second, the market has been concerned that USDA has feed demand for corn too high with animal numbers below last year. Corn stocks were higher than estimated and could indicate corn is not getting fed as expected from previous estimates. Bear in mind that the trade today missed the USDA corn stocks by much less than previous quarters.
Before the report corn was trading down 3 cents, soybeans were up 5 cents, and wheat was down 5 cents. Following the report at 12:30 pm, corn was down 20 cents, soybeans were down 60 cents, and wheat was down 14 cents.
The USDA reports today were the planted acres report along with grain stocks as of June 1st. Traders were looking for the reports in general to be bearish. Many had thought that the acres report would be the more important report of the two. Ahead of the report traders thought corn acres would be 91.7 million acres, unchanged from the March planting intentions report. They also thought soybean acres would be up from the March estimate. The trader estimate was 82.1 million acres, up from the March estimate of 81.5 million acres.
Late last week there were earnings reports from three publicly traded companies that detailed higher than expected soybean sales but lower than expected corn sales. Some had thought that soybean acres could be up as much as 3 million acres from the March estimate. Circulating in the trade this morning were ideas that corn acres could be below 90 million acres.
The trade was looking for June 1st corn stocks at 3.7 billion bushels with soybean stocks at 378 million bushels. For months soybeans have seen ever increasing demand for both exports and crush. The US has been swimming as an“island of scarcity,” for old soybeans. Many continue to talk of soybeans being tight but basis levels do not reflect that. Meanwhile a record soybean crop from South America continues to move to market.
Corn stocks could get somewhat of a hint from Friday’s Hog Report. Hog numbers were less than expected with hogs trading up the $3 limit today. That could indicate corn fed to livestock was reduced. It did indeed happen.
Prices have a tough road to hoe higher as continued rains and heat help describe growing conditions as “greenhouse like,” across much of the Midwest.
Read more:
Acres and Grain Stocks report shows record soybean crop | Ohio Ag …
See which stocks are being affected by Social Media
