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Quarterly Grain Stocks Report


The USDA released their Quarterly Grain Stocks report Tuesday morning. This report measures grain in all positions as of June 1st. It is used to benchmark feed demand and gauge whether or not any adjustments are needed to the size of last harvest’s crop. Below is a summary of the estimates:

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CORN

Corn in all positions totaled 4.45 bbu, up 595 mbu from the year prior (+15%). Of that total, 2.28 bbu were contained on farm (51.3% of total) which is up 22% from the year prior. Off farm stocks totaled 2.17 bbu, up 9% from last year. Disappearance for the March-May period came in at 3.30 mbu, up from 3.16 mbu a year ago (+4.4%). Editor’s Note: Though disappearance was higher year over year, the extent of the gains is likely not enough to justify the USDA’s current corn for feed estimate. However, many thought the number would be larger than what was actually reported, so the news is being digested as bullish.

 

SOYBEANS

Soybeans in all positions as of June 1 totaled 625 mbu vs 405 mbu the year prior (+54.3%). Of the total 246 mbu remained on farm (39.4% of total) which was up 126% from a year earlier! Off farm stocks were up 28% from last year at 379 mbu. Disappearance for the March – May quarter was 701 mbu, an increase of 19% from a year ago. Editor’s Note: Soybean stocks were tighter than expected, which implies that last year’s crop size was certainly overstated. The news is no doubt friendly, and should produce an old crop carryout under 300 mbu (it was projected at 400 mbu+ last harvest!!!!).

 

WHEAT

Wheat in all positions was listed at 753 mbu, above trade stiamtes of 718 mbu. The total was 28% higher than a year ago with 155 mbu of the total contained on farm (+60% y/y). Off farm stocks were up 21% vs last year at 597 mbu. Disappearance for the final quarter of the wheat marketing year was 388 mbu, down 17 percent from last year’s pace. Editor’s Note: Of the three commodities, wheat received the most neutral to bearish information. Positive price action is likely a reflection of strength in corn.

 

 

The Planted Acreage report is survey based and is conducted during the first 2 weeks of June. It shows planted acres for principal crops across the US and is a close estimate to what final acreage should be. However, the USDA has the ability to re-survey these acres if they feel the results may have changed between the survey time period and now. Below is a summary of the numbers.

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CORN

Corn acreage came in at 88.9 mln acres vs expectations of 89.3. Acres are the lowest since 2010, down 2% from last year. Editor’s Note: The acreage numbers didn’t contribute as much to the bullishness as the Stocks report did. Many expect the USDA to resurvey acres due to the wet weather out east. So today’s numbers likely weren’t going to mean much to the trade anyway. If the USDA decides to resurvey, the results will be available in the August S&D report.

 

SOYBEANS

Soybean planted acres were listed at 85.1 mln, up 2% from a year ago and an all-time record for soybeans. Record acres were noted in MN and WI out of the Midwest. Editor’s Note: As with corn, the key numbers today were contained in the Stocks report. Market direction from here will be focused on developing crop condition and getting a handle on just how many acres were lost due to flooding.

 

WHEAT

All wheat planted acreage was listed at 56.1 mln acres, down slightly from last year (-1%) but up from the March intentions number of 55.4 mln. Wheat followed the other commodities higher, but received the least amount of bullish information from the acreage numbers.

 

The markets have responded favorably to the numbers:

As of 12:53 PM

Sept Corn +25 @ $4.16

Aug Beans +45 @ $10.39

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

P: (402) 685-5613 | C: (402) 380-9855 | Greg.Mockenhaupt@cvacoop.com

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

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