Sep 27, 2021

USDA Reports Due Thursday

Reports lean supportive as they should underscore tightening stocks situation

Trade Expectations for Sept 30 Reports

  • USDA will issue Sept 1 grain stocks estimates, wrapping up the corn and bean year, and will update small grains production with its Sept 30 reports.

  • The estimates discussed are from Reuters' poll of analysts.

  • Corn ending stocks are seen at 1,155 million bushels; if confirmed, that would be down notably from 2019/20’s stocks at 1,919 million. The trade looks for a minor revision of 10 million bushels from the 2020 corn crop.

  • Bean ending stocks are seen at 174 million bushels; like corn, that would be down substantially from 2019/20’s final total at 525 million. No major production revision is expected for the 2020 bean crop.

  • On the wheat side, Sept 1 stocks are estimated at 1,852 million bushels; that would be down from 2,158 million last year and underscores the tightening situation we are facing for wheat balance sheets.

  • For production, the trade looks for a trim to all wheat from USDA’s August total at 1,697 million bushels to 1,680 million.

  • Most of the cut is expected for non-durum spring wheat production, which is seen at 327 million bushels. But, the range of expectations is extremely wide from a low end of 273 million to a high of 357 million.

FBN’s Take On What It Means: Generally, the reports lean supportive as they should underscore a tightening stocks situation versus a year ago across corn, beans, and wheat. Plus, on the production side, the trade looks for a cut to spring wheat, which could come from smaller harvested area and/or smaller yields. Surprises for corn, beans, or wheat would be much larger totals than what the trade leans towards.


Louis Dreyfus and Others Shutter Soy Crush Plants in China

  • At least 20 soybean crushing plants in China have shuttered to comply with mandates on power consumption.

  • The plants include one facility owned by Louis Dreyfus; another owned by Bunge responded to the power mandates but did not see significant production changes.

  • Soymeal prices are sharply up in China in response to the closings.

  • However, there’s little risk of excess soybean stocks, as soybean imports have been relatively weak recently amid already heightened global prices.

FBN’s Take On What It Means: The soy crush plants are the latest industry to feel the pressure from stepped up enforcement of emissions limits in China. Other industries have included fertilizer production and aluminum smelting. While some relief may come amid worries over short-term supplies of soymeal ahead of holidays at the beginning of October, the market does not anticipate a major reversal on the emissions mandates.

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Kevin McNew

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Marketwatch: Oct, 24

cmdty National Corn Price Idx: ZCPAUS.CM

open: 5.1374
high: 5.1867
low: 5.1249
close: 5.1668

cmdty National Soybean Price Idx: ZSPAUS.CM

open: 11.801
high: 11.861
low: 11.7324
close: 11.7679

cmdty National Hard Red Winter Wheat Price Idx: KEPAUS.CM

open: 7.4043
high: 7.5443
low: 7.3993
close: 7.5365

cmdty National Soft Red Winter Wheat Price Idx: ZWPAUS.CM

open: 6.9986
high: 7.0999
low: 6.9861
close: 7.0671