MarketsFarm – In the United States Department of Agriculture’s (USDA) supply and demand report issued Friday, corn estimates were lowered from the October report and those for soybeans largely remained the same for the 2019/20 marketing year. There were some revisions for wheat as well.
In the latest World Agriculture Supply and Demand Estimates (WASDE), the department lowered its estimate for the U.S. corn yield to 167.0 bushels per acre (BPA) from October’s 168.4. Average trade expectations pegged yields at 167.2 BPA.
Difficult growing conditions throughout most of 2019 led to the reductions. However, the USDA maintained its estimate of harvested acres at 81.8 million.
The November report called for corn production to be down as well, from 13.779 billion bushels to now 13.661 million. Ending stocks were also lowered, from October’s 1.929 billion bushels to November’s projection of 1.910 billion.
The initial reaction on the Chicago Board of Trade (CBOT) was bullish as corn bids increased by five to six U.S. cents per bushel.
It was a different story for soybeans, as the USDA maintained its yield forecast at 46.9 BPA. The market prediction was for a slight drop to 46.6 BPA.
With holding firm on yields, the November WASDE also kept corn production at 3.550 billion bushels. However the carryover moved up to 475.0 million bushels, an increase of 15.0 million from the October report. The USDA cited a decreased crush demand and lower soymeal exports as the reasons why.
The department kept its estimate of harvested soybean acres at 75.6 million.
The November WASDE had a mostly bearish effect on the CBOT soy complex, with soybeans down approximately seven cents per bushel. Soymeal was lower as well, but soyoil was up slightly.
Wheat saw some changes, as the November report had a tiny change to the yield, from October’s 51.6 BPA to now 51.7. Also, there was a decrease in harvest acres, from 38.1 million in October to 37.2 million.
The impetus for the change was the heavy dump of snow in October that struck Montana and North Dakota, as well as the Canadian Prairies.
This meant the production estimate was lowered to 1.920 billion bushels from 1.962 billion the previous month. The carryout was decreased as well, from 1.043 billion bushels last month to 1.014 billion this month.
Wheat prices were mixed following the release of this month’s WASDE. Minneapolis bids were up a couple of cents per bushel while Chicago and Kansas City wheat slipped by about three cents.