USDA’s Report - U.S. Focus
- As expected, USDA trimmed US corn, soybean, and wheat stocks.
- For corn, production was trimmed by a historically large total.
- That cut partially was offset by a trim to exports and to ethanol.
- Regardless, US corn stocks are seen at 1,552 million bushels, or the tightest level in years. The export cut could be a bit premature.
- For soybeans, production was cut as well while imports, crush, and exports were raised. Stocks are seen at 140 million bushels.
- Wheat feed use was bumped higher, in line with our expectations.
- Markets moved substantially higher on the news.
FBN’s Take On What It Means: The question now is whether we will start to ration demand at these price levels. However, China is not expected to cut back on its current needs, which should keep our export programs strong. The item to watch in the US will mainly be corn use - both ethanol and feed.
USDA Reports - World Focus
- Global stocks were trimmed for wheat, corn, and soybeans.
- Combined Brazil and Argentina production was lowered for soybeans and corn, but the soybean cut was in Argentina - down two million tonnes.
- China’s corn and wheat imports were boosted versus the December report with corn imports now seen at 17.5 million tonnes.
- China’s soybean imports were held but its production was boosted.
- Argentina’s wheat crop was cut, Russia’s was raised but exports were cut one million tonnes.
FBN’s Take On What It Means: USDA confirmed that stocks are expected to be tighter now versus a month ago. Weather in Argentina and Brazil will continue to be important in the coming weeks. China’s demand is not expected to decline but buying interest will shift to South America.
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