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Corn Outlook:
Traders are busy sorting out the details from this week’s crop report for corn as the USDA increased their yield estimate to a record 183.1 bpa but lowered harvested acres 700,000 to 82.7 million. Ending stocks for 2024-25 declined as a result to 2.073 BB. However, this is still a massive supply with stocks rising since 2022 while consumption has been flat since 2020. Meanwhile, Mother Nature has been good to the crop this season as reflected in the rating of 67 percent in good-to-excellent condition, which is just above the 10-year average of 66 percent. Looking at exports, inspections last week were 38.3 MB, which is short of the pace needed to meet USDA’s projection of 2.250 BB. The bottom line in corn is that price gains will be limited unless demand rises to diminish supply.
Bean Outlook
Soybeans were slapped in the face this week when the USDA increased their yield estimate to a record 53.2 bpa and raised harvested acres 1.0 million to 86.3 million. This ratcheted 2024-25 ending stocks up to 560 MB, the second highest on record. Meanwhile, world stocks are sitting at a record 134.3 million tons. Compounding the problem is usage has largely been flat since 2020. Weather has been unusually cooperative this season which has been responsible for the increase in yield. This can be seen from last week’s crop rating standing at 68 percent in good-to-excellent condition which is well above the 10-year average of 63 percent. Looking at exports, they are nothing to write home about as inspections last week were 11.9 MB and below the pace that must be shipped to reach USDA’s target of 1.7 BB. However, China took 2.1 MB, their largest shipment since early June. The bottom line in soybeans is that it faces a long road ahead unless weather is a factor with the crop in South America this fall and winter.
Wheat Outlook:
Wheat stocks have been rising since 2022 with USDA’s current estimate at 828 MB. However, global stockpiles are on the downswing and have declined since 2019 because of lower production in the EU and Russia. This is supportive of values longer-term. Meanwhile, winter wheat harvest is heading into the sunset while harvest of the spring crop is 18 percent complete versus the average of 21 percent. Looking at exports, inspections last week were a marketing year high of 23.8 MB and are on track to reach USDA’s projection of 825 MB. The bottom line in wheat is that the fundamentals are improving, but there are still challenges.
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