The U.S. Department of Agriculture yesterday released the May "World Agricultural Supply & Demand Estimates" report, lowering ending stocks for 2016-17 corn and soybeans a little more than expected. Wheat was left unchanged, but the trade,on average, had expected an increase.
Its first 2017 winter wheat production forecast put all winter wheat at 1,246 billion bu., which was down from last year’s level of 1.67 billion bu. and down from average trade forecasts. USDA based the lower number on fewer acres this year, lower expected yield and a late-April storm that hit the hard red winter wheat crop.
Corn and wheat futures moved higher after the report, with July corn about 6 cents higher shortly after the numbers came out and July soft red winter wheat trading about 5 cents higher after being about a penny lower ahead of the numbers.
Soybean futures showed little reaction to the numbers, trading about 5 cents higher before and after the report.
Corn ending stocks for 2017-18 came in at 2.11 billion bu., down from this year’s 2.295 billion bu., as USDA expects fewer acres and lower yield. It also estimates a 2% drop in use, while lower exports should more than offset an increase in domestic use.
Soybean ending stocks for 2017-18 of 480 million bu. versus this year’s 435 million bu. were largely attributed to the big beginning stocks, even as domestic use and exports are expected to be higher and the crop lower.