Trade Expectations for USDA’s Monthly Reports
- December reports are slated for release mid-morning on Thursday, December 10.
- Versus November, the trade looks for smaller stocks for the US corn, soybeans, and wheat.
- Brazil’s soy crop is seen at 132 million tonnes with Argentina at 50.4 million; both forecasts are down slightly from USDA’s report in November.
- Corn production for Brazil is seen at 109 million tonnes and for Argentina, the crop is expected at 49.25 million tonnes, both lower versus November.
- For the world, the trade looks for higher wheat stocks overall, at 321 million tonnes, likely on the larger Australian crop.
- Global corn stocks are expected to decline about two million tonnes versus November while soybean stocks tighten as well to 85 million tonnes.
FBN’s Take On What It Means: The trade looks for overall supportive numbers from USDA this week. There will not be revisions to US crop production in this report, but updates to other countries, especially in the Southern Hemisphere, are likely. A surprise would be larger stocks for the US and/or a larger crop outlook for Brazil+Argentina.
Australia Ag Exports To Increase
- ABARES increased its forecast for agricultural exports to A$49.24 billion, up from A$48.8 billion in September.
- Exports are set to rise after three years of drought were broken by heavy rains this season.
- The total would be higher except for the trade dispute that is brewing with China.
- China has imposed anti dumping tariffs on barley and wine after Australia encouraged an investigation into the start of the coronavirus.
- There is concern that the dispute will spill over into the wheat trade just as Australia has harvested its second largest crop on record.
FBN’s Take On What It Means: While Australia’s sales to China may be affected by tariffs, the country is actively seeking other destinations for its increased supplies. Some world wheat values may suffer from the increased competition. However, there have been reports of China inquiring about US hard wheat availability. If purchases are confirmed, it would be supportive for prices here.
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