Markets are softer on the open with corn and wheat down 2 and soybeans down 4. Look for quiet trade ahead of this morning’s USDA report which will be released at 11am. Estimates are listed below.
USDA Quarterly Stocks (Billion Bushels)
USDA March 1, 2020 Average Estimate
Corn 7.953 8.125
Soybeans 2.253 2.241
Wheat 1.412 1.432
USDA Prospective Plantings (Million Acres)
USDA March 1, 2020 Average Estimate 2019 Final
Corn 96.99 94.328 89.7
Soybeans 83.51 84.865 76.1
Wheat 44.65 44.982 45.2
I would not be surprised by a significant change in the corn stocks report, and it could be in either direction, but my bias is to the downside. Up to 1.2 billion bushels of corn were still in the field when USDA last surveyed in December. The USDA asked farmers to estimate bushels in the field, and it considered those bushels “stored on the farm.” Much of that corn has been harvested, giving farmers a better idea of its yield and quality which is what could move stocks dramatically either way in today’s report. Unfortunately even if the stocks come in lower, demand for corn in the ethanol industry is falling like a rock and will not be coming back anytime soon. Add on a 92-93 million acre corn crop at trend line yield and we have no reason to move the market higher.
Check back after 11am for the updated numbers in today’s report.
Have a Safe Day!