Domestic Wheat Stocks Drop 9 Million Bushels


by Linda H. Smith, DTN Markets Editor

WASHINGTON (DTN) — Corn and soybean yields and production were both reduced in USDA’s Nov. 9 report, and came in below average trade expectations.

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CORN: Corn production is estimated at 12.3 billion bushels, down 1{fe867fa2be02a5a45e8bbb747b653fe2e9d0331fd056b85cd0c1a3542435a96e} from both the October forecast and 2010. USDA left acreage at 83.9 million acres, unchanged from October; reduced yield 1.4 bushels an acre to 146.7, more than a bushel below the average trade expectation. Still, this will be the fourth-largest production on record.

SOYBEANS: Soybean production is forecast at 3.05 billion bushels. That’s a slight reduction from the October report and 9{fe867fa2be02a5a45e8bbb747b653fe2e9d0331fd056b85cd0c1a3542435a96e} below last year, based on 41.3 bushels per acre, down 0.2 from last month and 2.2 bushels from last year. Acreage was left unchanged at 73.7 million.

For Crop Production:


CORN: Corn usage changes include a 13-million-bushel increase in the food, seed and industrial use category. Feed and residual use dropped 11 million bushels. Ending stocks dropped to 843 million bushels from 866 million last month. USDA left its corn price estimate unchanged at $6.70.

SOYBEANS: Highlighted soybean usage changes include a 50-million-bushel reduction in exports due to the slow pace through October, and a reduction in crush. Ending stocks are pegged at 195 million bushels. USDA lowered both ends of its price range, leading to an expected mid-range estimate of $12.60.

WHEAT: U.S. wheat supplies and ending stocks for all wheat for the 2011-12 marketing year dropped 9 million bushels. The change in production was attributed to the updated production estimates for resurveyed states, where significant acreage was unharvested in September. The national average cash price was reduced to $7.40, with reductions on both ends of the estimated range.

“Ending stocks of corn and wheat were lowered from October estimates, though neither as much as pre-report estimates had averaged,” said DTN Senior Analyst Darin Newsom. “Soybean ending stocks increased by 35 mb due to a 50 mb decrease in export demand. Corn and wheat could be viewed as neutral to bearish with soybeans bearish.”

For Supply and Demand Estimates (WASDE):


CORN: Global ending stocks of corn came in at 121.6 million metric tons, down from October’s 123.2 estimate and 1 million below the average trade expectation.

“Ending stocks of corn came in below pre-report expectations and 1.6 mmt less than October and could be viewed as bullish,” Newsom said.

SOYBEANS: Global ending stocks of soybeans increased 0.6 million tons, as expected, to 63.6 mmt.

“Soybean ending stocks were in line with the average pre-report estimate and up slightly from October and should be viewed as neutral,” Newsom said.

WHEAT: Global wheat ending supplies increased 2.6 million tons, mostly due to higher production in Kazakhstan and EU-27. Ending stocks were increased a modest 0.2 million tons, but were expected to decrease slightly.

“Wheat ending stocks came in slightly above the October projection and 1 mmt above the average pre-report estimate and should be seen as bearish,” Newsom said.


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Posted with DTN Permission by Haylie Shipp


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