By DTN Analysts
This article was originally posted at 11:01 a.m. CDT. It was updated at 12:25 p.m.
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OMAHA (DTN) -- In USDA's first detailed forecast of the 2022-23 corn and soybean crops, the May World Agricultural Supply and Demand Estimates (WASDE) pegged corn production at 14.46 billion bushels (bb) and the soybean crop at 4.64 bb with both projections falling in line with the pre-report average estimates.
The outlook for 2022-23 wheat production was pegged at 1.729 bb, up 83 million bushels (mb) from last year, with higher projected yields offsetting a slight decrease in harvested area. Globally, production is forecast at 774.8 million metric tons (mmt), 4.5 mmt lower than last year, based on reduced production in Ukraine, Australia and Morocco.
Taking a look at Ukraine estimates for 2022-23, USDA pegs corn production at 19.5 mmt, less than half of Ukraine's corn production from 2021-22 crop. Corn exports are projected at 9 mmt for 2022-23 in Ukraine, down from 23 mmt for the old crop. For wheat, Ukraine's production was projected at 21.5 mmt for 2022-23, down from 53.51 mmt for the old wheat crop. Ukraine's wheat exports for the new crop are pegged at 10 mmt, nearly one-third of the 29.11 mmt projected for the 2021-22 crop.
According to DTN Lead Analyst Todd Hultman, Thursday's new U.S. ending stocks estimates were neutral for corn and soybeans, but bullish for wheat. Hultman pegged the world ending stocks estimates from USDA as bearish for corn, but bullish for soybeans and wheat.
Stay tuned throughout the morning and refresh this page often as we will be sending a series of updates with the important highlights from today's reports, including commentary from our analysts.
You can also access the full reports here:
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-- Crop Production: https://www.nass.usda.gov/…
-- World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…
CORN
The 2022-23 new-crop corn has farmers projected to plant 89.5 million acres with a 177 bushel-per-acre average. Production is pegged at 14.46 bb.
For usage, Feed and Residual use for the new crop is projected at 5.35 bb, lower than the old-crop usage. Ethanol used for the 2022-23 crop is forecast at 5.375 bb, the same as old-crop usage. Exports are pegged at 2.4 bb, down 100 mb from the old crop.
Total usage for the 2022-23 crop is projected at 14.565 bb, down 370 mb from 2021-22 crop.
The average farmgate price for the 2022-23 crop is projected at $6.75 a bushel.
Other than price, USDA made no supply or demand changes to 2021-22 old crop corn, holding ending stocks at 1.44 bb, the same as April estimates.
Total supply for the 2021-22 corn crop remained pegged at 16.375 bb. Feed and Residual use was projected at 5.625 bb. Ethanol use was forecast at 5.375 bb. Exports held pat at 2.5 bb as well.
That put the 2021-22 ending stocks as the same as April at 1.44 bb.
The average farmgate price was increased 10 cents $5.90 per bushel.
Globally, starting with the new crop, USDA's beginning stocks were 309.39 million metric tons. Production is pegged at 1,180.72 mmt. Exports are projected at 182.7 mmt. Ending stocks are projected at 305.13 mmt.
The big impacts were the dramatic cuts of production and exports for Ukraine. Those estimates for 2022-23 came in at corn production down to 19.5 mmt, less than half of Ukraine's corn production from 2021-22 crop. Corn exports are projected at 9 mmt for 2022-23 in Ukraine, down from 23 mmt for the old crop.
SOYBEANS
USDA estimates farmers will produce 4.64 bb of soybeans in 2022, reflecting its record 91-million-acre planting estimate and a trendline yield of 51.5 bushels per acre.
The production estimate as well as new- and old-crop ending stocks estimates were within the range of pre-report expectations.
For the new-crop, 2022-23 marketing year, USDA pegs ending stocks at 310 mb. Beginning stocks, which are also old-crop ending stocks, were 235 mb. USDA expects crushers to use 2.255 bb, while exporters will send 2.2 bb abroad. Slightly less will be used for seed in 2023 than in 2022 -- 102 mb -- while residual use is forecast at 23 mb. The result is 4.58 bb of total use. The national average farm gate price is initially forecast at $14.40.
For the old-crop, 2021-22 marketing year, USDA lowered its ending stocks estimate by 50 mb to 235 mb. The adjustment is a consequence of a 50 mb increase in exports. The agency also shifted 4 mb from residual use to seed use, reflecting the need for more seed to reflect higher planted acreage estimates. The national average farm gate price was left unchanged at $13.25 per bushel.
Globally, USDA lowered its forecast for old-crop, 2021-22 marketing year ending stocks to 85.24 mmt, below the range of pre-report expectations. The change reflects lower Chinese stocks, a reduction in Argentina's soybean production and lower U.S. stocks. Brazilian production was left unchanged at 125 mmt, while Argentina's output was lowered 1.5 mmt to 42 mmt.
Globally, USDA pegged new-crop, 2022-23 marketing year ending stocks at 99.6 million metric tons, up 14.4 million from the old-crop season. Global soybean production was revised upwards, with USDA expecting Brazilian production to bounce back sharply last year's drought as well as higher production in the U.S. and Argentina.
WHEAT
USDA's domestic projection of a 1.729 bb new-crop wheat crop came in near pre-report analyst estimates, with average yield set at 46.6 bushels per acre. New-crop ending stocks are expected to land at 619 mb, on the lower end of expectations. That's based on a lowered beginning stocks of 655 mb (left from old-crop ending stocks), bringing total supply to 2.504 bb. Food, seed and residual use for new crop are pegged at 1.110 bb, with exports at 775 mb.
U.S. farm gate prices were pegged at $10.75, well above last year's average of $7.70.
U.S. winter wheat production in the new-crop year is projected to reach 1.17 bb, on the low end of pre-report analyst expectations, and down 8% from last year, driven by drought conditions in many winter wheat growing regions. Overall yield was pegged at 47.9 bushels per acre, down 2.3 bushels from last year, with 24.5 million acres expected to be harvested for grain, down 4% from last year. Abandoned winter wheat acres were projected at their highest since 2002, with the most acres lost in Texas and Oklahoma.
Of those acres, hard red winter is pegged at 590 mb, down 21% from a year ago, and below analyst's pre-report estimates. Soft red winter wheat was pegged at 354 mb, down 2%. In contrast, white winter wheat production, set at 230 mb, is up 38% from last year, above pre-report expectations.
Globally, USDA pegged new-crop wheat production at 774.83 mmt, with ending stocks at 267.02 mmt, a tight situation based on reduced production in Ukraine (down to 21.5 mmt), India (down to 108.5 mmt) and Australia (down to 30 mmt). Old crop ending stocks were set at 279.72 mmt, up slightly from last month.
LIVESTOCK
May's WASDE report highlighted that beef production grew from a month ago, as non-fed and fed-cattle slaughter speeds remain aggressive. From April, beef production grew by 132 million pounds and red meat production grew by 100 million pounds from last month. It was especially interesting to note that the quarterly price projections, as May's report shared the first quarter projects for 2023, which hold a significant premium to the prices anticipated for 2022. Compared to last month, the second quarter is expected to average $140 ($1.00 higher), the third quarter held at $136, the fourth quarter is expected to average $145 ($2.00 higher), and the first quarter of 2023 is expected to average $150.
Beef exports grew by 56 million pounds, and beef imports also grew by 105 million pounds. For 2023, beef exports are down from 2022 on lower beef production and higher prices, and beef imports are lower on tight global supplies. For 2023, cattle prices are forecast above 2022 on tighter supplies.
Pork production for 2022 fell by 36 million pounds from last month as the industry isn't expected to be as aggressive in the first, second and fourth quarters, as stated in last month's report, which is largely affected by lighter carcass weights.
May's WASDE report also showed a decline in quarterly prices as pork demand isn't as strong as it was in years past. Compared to last month, the second quarter is expected to average $77.00 (down $3.00), the third quarter is expected to average $76.00 (down $1.00), the fourth quarter is expected to average $66.00 (down $3.00), and the first quarter of 2023 is expected to average $66.00. Pork imports grew by 8 million pounds, and exports fell by 14 million pounds.
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Editor's Note: Join DTN Lead Analyst Todd Hultman at 12:30 p.m. CDT on May 12 for a look at what the day's numbers mean for grain prices. To register, visit: https://www.dtn.com/…
| U.S. PRODUCTION (million bushels) 2022-23 |
| | May | Avg. | High | Low | | 2021-22 |
| Corn | 14,460 | 14,779 | 15,115 | 14,414 | | 15,115 |
| Soybeans | 4,640 | 4,604 | 4,653 | 4,435 | | 4,435 |
| All Wheat | 1,729 | 1,789 | 1,915 | 1,635 | | 1,646 |
| Winter | 1,174 | 1,245 | 1,359 | 1,146 | | 1,277 |
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| U.S. ENDING STOCKS (Million Bushels) 2021-22 |
| | May | Average | High | Low | Apr | |
| Corn | 1,440 | 1,404 | 1,440 | 1,310 | 1,440 | |
| Soybeans | 235 | 222 | 260 | 175 | 260 | |
| Wheat | 655 | 681 | 713 | 650 | 678 | |
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| U.S. ENDING STOCKS (Million Bushels) 2022-23 |
| | May | Average | High | Low | | |
| Corn | 1,360 | 1,305 | 1,627 | 988 | | |
| Soybeans | 310 | 319 | 488 | 200 | | |
| Wheat | 619 | 655 | 725 | 560 | | |
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| WORLD ENDING STOCKS (million metric tons) 2021-22 | |
| | May | Avg. | High | Low | Apr | |
| Corn | 309.4 | 303.7 | 308.0 | 298.5 | 305.5 | |
| Soybeans | 85.2 | 89.0 | 90.4 | 86.5 | 89.6 | |
| Wheat | 279.7 | 278.3 | 282.5 | 275.0 | 278.4 | |
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| WORLD ENDING STOCKS (million metric tons) 2022-23 | |
| | May | Avg. | High | Low | | |
| Corn | 305.1 | 295.6 | 307.7 | 278.0 | | |
| Soybeans | 99.6 | 98.0 | 107.8 | 89.4 | | |
| Wheat | 267.0 | 271.6 | 286.8 | 261.0 | | |
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| WORLD PRODUCTION (million metric tons) 2021-22 | | |
| | May | Avg | High | Low | Apr | |
| CORN | | | | | | |
| Argentina | 55.0 | 52.1 | 53.0 | 50.0 | 53.0 | |
| Brazil | 126.0 | 113.9 | 116.5 | 110.0 | 116.0 | |
| SOYBEANS | | | | | | |
| Argentina | 51.0 | 42.8 | 44.0 | 41.0 | 43.5 | |
| Brazil | 149.0 | 124.5 | 125.4 | 123.0 | 125.0 | |
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