By Chris Clayton
DTN Ag Policy Editor
and
Katie Micik
DTN Markets Editor
WASHINGTON (DTN) -- USDA slightly reduced projected corn yields to an average 167.5 bushels an acre while boosting the expected soybean yield to 47.1 bushels an acre.
USDA lowered corn production by 100 million bushels from the August projection. Soybean production was bumped up by 19 million bushels.
Old-crop soybean ending stocks are pegged at 210 million bushels, closer to the low end of the pre-report projections. Old-crop corn ending stocks are projected at 1.73 billion bushels, closer to the low end of the pre-report estimates.
USDA pegged the new-crop ending stocks, 2015-16, for corn at 1.59 billion bushels, slightly above the pre-report average estimate. For soybeans, new-crop ending stocks are estimated at 450 million bushels, closer to the high end of the pre-report speculation.
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World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…
CORN
September's Crop Production numbers came in slightly below the pre-report estimate with USDA forecasting a 13.58 billion bushel corn crop, down less than 1% from the August forecast. USDA pegged the yield at 167.5 bpa, down 1.3% from the August numbers. Still, if realized, this would be the second-highest yield and third-largest crop on record. USDA projected harvested acres at 81.1 million, unchanged from the August projections. Record yields are forecast for Arkansas, Georgia, Iowa, Kentucky, Michigan, Minnesota, Nebraska, South Dakota, Virginia and Wisconsin.
The September World Agricultural Supply and Demand Estimates (WASDE) lowered old-crop ending stocks by 40 million bushels. The change was due to 5 million bushels more used for ethanol production in the U.S. and a 10 million bushel increase in food, seed and industrial use as well as a 25 million bushel increase in exports.
For new-crop numbers, USDA lowered production by 101 million bushels. Factoring in the old-crop carryover, total supply was decreased by 141 million bushels. On the demand side, feed and residual use was lowered by 25 million bushels. Food, seed and industrial use was increased by 5 million bushels, translating in to a projected 2015-16 ending stocks of 1.59 billion bushels, or 121 million bushels lower than last month's forecast.
USDA projects an average farm-gate price for corn at $3.75 a bushel for the 2015-16 crop. The projected ending stocks-to-use ratio declined to 11.6%.
Globally, USDA lowered 2015-16 ending stocks to 189.7 million metric tons, down 5.4 mmt from last month. The decline largely reflects a 4.3 mmt cut to EU corn production and the lower production estimate for the U.S. USDA left its forecasts for Brazil and Argentina corn production unchanged at 79 mmt and 25 mmt respectively. Global stocks-to-use came in 19.2%.
SOYBEANS
Production is forecast at 3.94 billion bushels, up slightly from the August forecast and at the high range of the pre-report estimates. Yield is projected at 47.1 bushels an acre, up 0.2 bpa from last month's numbers. Farmers are expected to harvest a record 83.5 million acres. Record yields are projected for Arkansas, Georgia, Iowa, Kentucky, Michigan, Minnesota, Nebraska and South Dakota.
USDA lowered old-crop ending stocks by 30 mb by increasing domestic crush by 15 mb, boosting exports by 10 mb and by making small adjustments to imports and residual use.
For the 2015-16 crop, USDA's 19 mb increase in production and lower beginning stocks contributed to an 11 mb cut to projected supplies. USDA forecast a 10 mb high rate of crush and trimmed residual use by 2 mb, resulting in a 20 mb cut to ending stocks. Those were pegged at 450 mb.
The national average farm gate price was left unchanged at $9.15. The stocks-to-use ratio was unchanged at 12.1%.
Globally, USDA lowered ending stocks to 85 mmt, down 1.9 mmt from last month, on reduced production in Ukraine and Canada. USDA also lowered old-crop ending stocks to 78.7 mmt from last month's estimate of 80.6 mmt.
USDA left its forecast for Brazil and Argentina's soybean production unchanged at 97 mmt and 57 mmt, respectively.
Global ending stocks-to-use came in at 27.4%.
WHEAT
USDA didn't release any new-crop production information for wheat in Friday's reports. It made a 25 mb reduction to wheat exports, resulting in an equivalent increase in ending stocks. The forecast ending stocks were estimated at 875 mb.
The national average farm gate price was lowered 10 cents to $5 per bushel. The stocks-to-use ratio increased to 40.9%.
Globally, USDA also increased ending stocks by 5.1 mmt to 226.6 mmt on increased production in the EU and Former Soviet Union states. The stocks-to-use ratio increased to 31.6%.
GRAIN SORGHUM
Production is pegged at 574 million bushels, up slightly from August numbers and up 33% from 2014's crop. Based on September conditions, yield is projected at a record 74.9 bushels an acre, up 0.3 bushels from the August numbers. Nebraska is projected to produce a record yield.
ANALYSIS
On the domestic side, USDA's September WASDE estimate of U.S. corn ending stocks for 2015-16 is 1.592 billion bushels, based on 13.585 billion bushels of estimated production with a yield of 167.5 bushels an acre. The 2015-16 ending stocks estimate is down from 1.732 billion bushels for 2014-15 and is slightly more than expected. "Friday's report should be viewed as neutral for corn," said DTN Analyst Todd Hultman.
USDA's estimate of U.S. soybean ending in 2015-16 is 450 million bushels, based on 3.935 billion bushels of production and a yield of 47.1 bushels an acre. The 2015-16 estimate of ending stocks is up from 210 million bushels for 2014-15. Old-crop stocks were less than expected, but new-crop stocks were more than expected. "Friday's report should be viewed as bearish for soybeans overall," Hultman said.
USDA's estimate of U.S. ending wheat stocks for 2015-16 is 875 million bushels, based on 2.136 billion bushels of production and is a little more than expected. "Friday's U.S. report should be viewed as slightly bearish for wheat," Hultman said.
On the world side, USDA's estimate of global ending corn stocks for 2015-16 was reduced from 195.09 to 189.69 mmt and is less than expected. 2014-15 corn production estimates for Brazil and Argentina were both kept unchanged from August.
USDA's world ending soybean stocks estimate for 2015-16 was reduced from 86.88 mmt to 84.98 mmt and is less than expected. 2014-15 production estimates for Brazil and Argentina stayed unchanged from August.
USDA's estimate of world ending wheat stocks for 2015-16 was increased from 221.47 mmt to 226.56 mmt and is more than expected. Production estimates showed increases for the Former Soviet Union.
"Friday's world estimates from USDA are bullish for corn and soybeans, but bearish for wheat," Hultman said.
| U.S. CROP PRODUCTION (Million Bushels) 2015-16 |
| | Sept | Avg | High | Low | Aug | 2014-15 |
| Corn | 13,585 | 13,493 | 13,870 | 13,050 | 13,686 | 14,216 |
| Soybeans | 3,935 | 3,838 | 3,935 | 3,590 | 3,916 | 3,969 |
| Grain Sorghum | 574 | 565 | 605 | 525 | 573 | 433 |
| U.S. AVERAGE YIELD (Bushels Per Acre) 2015-16 |
| | Sept | Avg | High | Low | Aug | 2014-15 |
| Corn | 167.5 | 166.6 | 170.5 | 161.0 | 168.8 | 171.0 |
| Soybeans | 47.1 | 46.0 | 47.1 | 43.0 | 46.9 | 47.8 |
| U.S. ENDING STOCKS (Million Bushels) 2015-16 |
| | Sept | Avg | High | Low | Aug |
| Corn | 1,592 | 1,580 | 1,877 | 1,130 | 1,713 |
| Soybeans | 450 | 396 | 475 | 125 | 470 |
| Grain Sorghum | 41 | 37 | 45 | 31 | 39 |
| Wheat | 875 | 860 | 892 | 828 | 850 |
| U.S. ENDING STOCKS (Million Bushels) 2014-15 |
| | Sept | Avg | High | Low | Aug | 2013-14 |
| Corn | 1,732 | 1,770 | 1,829 | 1,713 | 1,772 | 1,232 |
| Soybeans | 210 | 228 | 245 | 200 | 240 | 92 |
| WORLD ENDING STOCKS (Million Metric Tons) 2015-16 |
| | Sept | Avg | High | Low | Aug |
| Corn | 189.7 | 194.2 | 196.4 | 192.0 | 195.1 |
| Soybeans | 85.0 | 86.5 | 89.1 | 82.9 | 86.9 |
| Wheat | 226.6 | 221.7 | 224.0 | 220.0 | 221.5 |
| WORLD ENDING STOCKS (Million Metric Tons) 2014-15 |
| | Sept | Avg | High | Low | Aug | 2013-14 |
| Corn | 197.2 | 197.5 | 199.0 | 196.0 | 197.4 | 175.0 |
| Soybeans | 78.7 | 80.4 | 81.2 | 79.4 | 80.6 | 62.7 |
| Wheat | 211.3 | 210.0 | 212.0 | 209.0 | 209.7 | 193.4 |
| WORLD PRODUCTION (Million Metric Tons) |
| | | 2015-2016 | | 2014-2015 |
| | | Sept | Aug | | Sept | Aug |
| FSU-12 wheat | 117.0 | 115.0 | | 112.7 | 112.7 |
| Australia wheat | 26.0 | 26.0 | | 23.7 | 23.7 |
| | | | |
| Brazil corn | 79.0 | 79.0 | | 84.0 | 84.0 |
| Argentine corn | 25.0 | 25.0 | | 26.5 | 26.5 |
| | | | |
| Brazil soybeans | 97.0 | 97.0 | | 94.5 | 94.5 |
| Argentine soybeans | 57.0 | 57.0 | | 60.8 | 60.8 |
(AG)
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