U.S. Department of Agriculture (USDA) officials Tuesday released their monthly World Agricultural Supply and Demand Estimates (WASDE). The report contained minor revisions, primarily to global production.
Jim McCormick, branch manager of Ag Market.Net, speaks to USDA’s March WASDE, which upheld domestic ending stocks.
“The government pretty much left everything unchanged – For corn, soybeans, and wheat ending stocks,” McCormick said. “The corn ending stock is 1.892 million (bushels), bean ending stock is 425 (million bushels) and the wheat ending stock is 940 million (bushels).”
Agents made adjustments to global production, which raises some concern, according to McCormick.
“They left corn production in Argentina and Brazil unchanged, but they chose to raise (soy)bean production. Brazil is now up to 126 million metric tonnes (and) Argentina is up to 54 million metric tonnes,” McCormick said. “They are (in) direct competition with us for Chinese demand. The Brazilian currency continues to weaken, and that works against us.”
China will purchase soybeans from South America, in the near-term. However, McCormick remains optimistic about China’s intentions to meet Phase One trade targets.
Volatility will continue moving forward, as markets key off what’s happening in the stock markets. The “next, big grain market situation” will occur at month’s end, according to McCormick.
“That is when we’re going to get farmers’ survey of acres they intend to plant. The other thing that will hopefully be a bullish surprise is the Quarterly Grain Stocks report,” McCormick said. “Our group has been arguing that this feed usage number has been understated. If we are correct on that assement, that should show up on this Quarterly Grain Stocks report. Hopefully we get a little friendly news, at least on old crop corn. The acreage number is expected to be a little negative for new crop.”
