Oct. 12 WASDE Report Remains Next Catalyst
Economists predict next report will reduce inventory estimates
Weekly USDA crop progress report says 52% of the corn crop is in good or excellent condition. This compares to 52% last week and 66% in prior year: 79% of the corn crop is mature vs. 63% last week and a 78% average over the last 5 years; 21% of the corn crop has been harvested vs. 15% last week and a 23% average of the last 5 years.
54% of the soybean crop is in good or excellent condition compared to 53% last week and 64% y/y; 19% of soybean crop has been harvested vs. 5% last week and 25% average of the 2006-10 period.
The next WASDE report will be released on Wednesday, Oct. 12. September's corn report had a yield estimate of 148.1 bu/acre and harvested acreage of 84.4 million acres giving total production of 12.5 billion bushels and total supply of 13.4 billion bushels (including imports and beginning stocks).
Inventory as of Sept. 1, 2012 is estimated at 672 million bushels. We expect that the yield number may be revised lower by 0.5 to 1.5 bushels/acre and that the harvested acreage may be pushed lower by 0.5 to 1.0 million acres. This would bring production down to a range of 12.2 to 12.3 billion bushels. We expect demand to be adjusted as well to leave ending inventories near the September estimate. As such we would expect fertilizer shares to move a bit higher on the slightly bullish news.
