PF Special Reaction: Corn Carry a Bit Higher Than Expected, Beans a Bit Lower

Posted on 03/09/2017 10:23 AM

Market reaction

Ahead of the reports, corn futures were trading 5 to 7 cents higher, soybeans were 5 to 7 cents higher (meal was higher, bean oil was lower), SRW was mostly 6 to 8 cents higher, HRW was 5 to 6 cents higher, spring wheat was 5 to 7 cents higher and cotton was 40 to 110 points higher.

In post-report trade, most markets have pared gains. Corn is mostly 1 1/2 to 4 cents higher, soybeans are 3 to 4 cents higher (soybean meal is still higher and bean oil is still lower), SRW wheat is mostly 5 to 6 1/2 higher, HRW is 4 1/2 to 5 1/4 cents higher, spring wheat is 4 to 7 cents higher and cotton is 40 to 100 points higher.

Pro Farmer Editor Brian Grete reacts:

2015-16 U.S. carryover

Corn: 1.862 billion bu.; up from March projection of 1.837 billion bu.
-- compares to 1.731 billion bu. in 2014-15
Beans: 445 million bu.; down from March projection of 460 million bu.
-- compares to 191 million bu. in 2014-15
Wheat: 976 million bu.; up from March projection of 966 million bu.
-- compares to 753 million bu. in 2014-15
Cotton: 3.5 million bales; down from March projection of 3.6 million bales
-- compares to 3.7 million bales in 2014-15


USDA increased estimated old-crop corn carryover by 25 million bu. from last month, pushing ending stocks about 20 million bu. above pre-report trade expectations. USDA cut estimated corn feed & residual use by 50 million bu. and partially offset that cut with a 25-million-bu. increase in estimated food, seed & industrial use (with all of the increase going to corn-for-ethanol use). USDA now puts the national average on-farm cash corn price at $3.40 (steady with month-ago) to $3.70 (down a dime from March).

USDA cut estimated old-crop soybean carryover by 15 million bu. from last month. At 445 million bu., carryover is 9 million bu. below the average pre-report trade guess. USDA increased estimated exports 15 million bu. (to 1.705 billion bu.) and cut estimated seed use by 1 million bu. from last month. USDA now puts the national average on-farm cash soybean price at $8.50 (up 25 cents) to $9.00 (down 25 cents from last month).

Wheat carryover matched pre-report trade expectations and was up 10 million bu. from last month. USDA cut estimated wheat feed & residual use by 10 million bu. (to 140 million bu.) from last month to push carryover higher. USDA now puts the national average on-farm cash wheat price at $4.90 (unchanged) to $5.00 (down a dime from last month).

USDA cut cotton carryover 100,000 bales from last month, which is a slightly bigger cut than traders expected. USDA cut the 2015 cotton crop by 70,000 bales by dropping the national average cotton yield by 4 lbs. per acre to 767 pounds. That cut to supply was partially offset by a 30,000-bale increase in estimated cotton imports (to 40,000 bales). USDA also increased estimated unaccounted use by 60,000 bales to drive carryover lower. USDA now puts the national average on-farm cash cotton price at 58 cents (steady with month-ago) to 59 cents (down 1 cent from last month).

 

2015-16 global carryover

Corn: 208.91 MMT; up from March proj. of 206.97 MMT
-- compares to 207.58 MMT in 2014-15
Beans: 79.02 MMT; up from March proj. of 78.87 MMT
-- compares to 77.73 MMT in 2014-15
Wheat: 239.26 MMT; up from March proj. of 237.59 MMT
-- compares to 214.80 MMT in 2014-15
Cotton: 102.22 mil. bales; down from March proj. of 103.34 mil. bales
-- compares to 111.88 million bales in 2014-15

 

2015-16 global production highlights

Argentina beans: 59.0 MMT; compares to 58.5 MMT in March
-- compares to 61.4 MMT in 2014-15
Brazil beans: 100.0 MMT; compares to 100.0 MMT in March
-- compares to 97.2 MMT in 2014-15
Argentina wheat: 11.3 MMT; compares to 11.0 MMT in March
-- compares to 12.5 MMT in 2014-15
Australia wheat: 24.5 MMT; compares to 24.5 MMT in March
-- compares to 23.08 MMT in 2014-15
China wheat: 130.19 MMT; compares to 130.19 MMT in March
-- compares to 126.21 MMT in 2014-15
Canada wheat: 27.6 MMT; compares to 27.6 MMT in March
-- compares to 29.42 MMT in 2014-15
EU wheat: 160.0 MMT; compares to 158.46 MMT in March
-- compares to 156.83 MMT in 2014-15
Russia wheat: 61.04 MMT; compares to 61.0 MMT in March
-- compares to 59.08 MMT in 2014-15
FSU-12 wheat: 117.60 MMT; compares to 117.53 MMT in March
-- compares to 112.74 MMT in 2014-15
China corn: 224.58 MMT; compares to 224.58 MMT in March
-- compares to 215.65 MMT in 2014-15
Argentina corn: 28.0 MMT; compares to 27.0 MMT in March
-- compares to 27.0 MMT in 2014-15
South Africa corn: 6.5 MMT; compares to 6.5 MMT in March
-- compares to 10.63 MMT in 2014-15
Brazil corn: 84.0 MMT; compares to 84.0 MMT in March
-- compares to 85.0 MMT in 2014-15
China cotton: 23.8 mil. bales; compares to 23.8 mil. bales in March
-- compares to 30.0 million bales in 2014-15

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