USDA Reports Preview

At 11 a.m. CDT on Monday, Sept. 30, USDA will release its estimates of Sept. 1 Grain Stocks, inventories that will represent ending stocks of corn and soybeans for 2023-24. USDA's NASS will also issue its Small Grains Summary with attention on U.S. wheat production in 2024.

SEPT. 1 GRAIN STOCKS

-- Corn

USDA's report of June 1 corn stocks on June 30 left us a bit confused, reporting a higher-than-expected 4.993 billion bushels (bb) of corn on hand. If true, that means only 11.739 bb of corn use was accounted for in the first three quarters of 2023-24, a smaller amount than two years previous when corn supplies were tighter and prices were much higher.

In the Sept. 12 WASDE report, USDA estimated 14.920 bb of corn demand in 2023-24, up 9% from the previous year and more in line with what we would expect in a year of more plentiful supplies. I usually don't argue with inventory reports, but I suspect it is best to forget USDA's June estimate in this case, as demand clues for corn have been strong most of the season. USDA estimates exports were up 38% in 2023-24 and demand for ethanol was up 3.6%. Feed demand is a wildcard but has also been active.

Dow Jones' pre-report survey of 14 analysts has an average estimate of 1.853 bb of corn for Sept. 1, the highest ending corn stocks in four years, if correct. Because corn demand has been visibly active at these low prices and basis was relatively firm until late July, I suspect ending corn stocks will be closer to 1.800 bb.

-- Soybeans

USDA's estimate of 970 million bushels (mb) of U.S. soybean stocks on hand as of June 1 was 13 mb higher than Dow Jones' average estimate at the time, but well within the range of guesses and not as controversial as corn proved to be. This time around, Dow Jones' analysts are expecting USDA to find 354 mb of U.S. soybean stocks as of Sept. 1, up from 264 mb a year ago and the highest in four years, if true.

With USDA's latest estimate of soybeans' average farm price in 2023-24 $1.70 lower than the previous season's $14.20 a bushel, it is disappointing to see USDA's estimate of total soybean use down 5% in 2023-24, but it shows once again how the U.S. is losing export share, primarily to Brazil's perennial expansion of cropland acres. Domestic crush demand, on the other hand, served the U.S. market well, increasing 3.8% in 2023-24.

One of the difficult parts of estimating and assessing USDA's Sept. 1 soybeans stocks is that early Southern harvests add to the totals. According to state NASS offices, 25% of soybeans in Louisiana and 17% of soybeans in Mississippi were harvested near the first of September.

-- Wheat

For U.S. wheat, Monday's report of Sept. 1 wheat stocks represents supplies after one quarter of demand in 2024-25. Based on USDA's Sept. 12 WASDE estimate, the U.S. will have 2.789 bb of beginning wheat supplies in 2024-25. To the pleasant surprise of wheat producers, weekly exports in the first quarter were stronger than expected, 34% higher than the same time a year ago. Dow Jones' survey expects USDA to estimate 1.984 bb of wheat on hand as of Sept. 1, up from 1.767 bb a year ago and the most in four years. Given this season's early popularity for U.S. wheat, actual stocks on Sept. 1 may be a little less than expected.

SMALL GRAINS SUMMARY

NASS' Small Grains Summary report is based on yield data from selected winter wheat plots and from a survey of wheat producers in the first two weeks of September. Last year, 55,900 producers were interviewed, and USDA estimated the boundaries of 95% confidence at plus or minus 4% for winter wheat and plus or minus 7.2% for other spring wheat.

The average production estimates from Dow Jones' survey for Monday's report were as follows:

For U.S. wheat production, Dow Jones estimates 1.984 bb, the most in eight years. Winter wheat production is estimated at 1.361 bb, the most in eight years. The total was broken out as 776 mb of hard red winter wheat, 342 mb of soft red winter wheat and 243 mb of white winter wheat. Other spring wheat is estimated at 544 mb, the most in four years, and durum is estimated at 77 mb, the most in five years. Of all the wheat estimates, only SRW wheat is estimated lower than a year ago, down from last year's 449 mb.

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Join us for DTN's webinar at 12:30 p.m. CDT Monday, Sept. 30, as we examine and discuss USDA's latest estimates. Questions are welcome and registrants will receive a replay link for viewing at their convenience. Register here for Monday's Grain Stocks and Small Grains Summary webinar: https://www.dtn.com/….

Todd Hultman can be reached at todd.hultman@dtn.com

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