USDA Report: Trade Expectations
- USDA is scheduled to release its October monthly report this Friday.
- The average trade expectation for corn yield is 177.7 bushels per acre, down from 178.5 last month.
- Total corn production is forecast at 14,815 million bushels on average, with ending stocks of 2,102 million bushels expected by the trade.
- Soybean yield is expected to be slightly lower with an average projection of 51.5 bushels per acre compared with 51.6 bushels last month.
- Soybean production is projected at 4,271 million bushels, and carry-out is seen at 352 million bushels.
- Wheat ending stocks are forecast at 887 million bushels, down from 925 million last month.
- The upland cotton production average forecast is down to 16.74 million bales from 17.1 million last month, and ending stocks are 6.79 million
FBN’s Take On What It Means: The surprising September 1 stocks reductions should show up again in this report as the lower carry-in is expected to flow through to decreased ending stocks for 2020/21. If this year’s corn crop is just a little less than expected, the potential for ending stocks below 2,000 million bushel could be a very real possibility. In soybeans the wild card is likely demand and whether USDA forecasts China’s buying surge to continue. Overall, the tightening stocks situation is expected to continue to be supportive to prices.
Record August Exports to China
- Corn shipments to China were a record 1.2 million tonnes in August, above the 951,600 tonnes in October 1995.
- US cotton exports to China totaled 154,024 tonnes in August, the most for any month since March 2013.
- Soybeans to China missed last year’s record for the month, falling 11% to 2.45 million tonnes.
- Pork exports in August were a record for the month at 59,922 tonnes, but were down 14% from July to a 10-month low.
- Through August, the 2020 total ag export value stood at $10.7 billion, almost 13% below the same point in 2017.
FBN’s Take On What It Means: China is still behind on commitments in the Phase 1 trade agreement that implied China would buy at least $36.5 billion worth of U.S. farm products in 2020, around 50% more than three years earlier. Export inspection data suggest that soybean shipments to China in September were a record, likely above 4 million tonnes. Though China may not be able to reach buying levels set forth in Phase 1, their increased demand is still expected to help buoy prices
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