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A 'non-report': USDA leaves grain stocks unchanged

Agriculture.com Staff 03/09/2007 @ 7:28am

Global grain supply and demand is unchanged from a month ago, making Friday's USDA-ERS World Supply and Demand report more of a "non-report" that was quickly seen by analysts as neutral to the U.S. commodities trade.

U.S. soybean ending stocks are still expected at a record 595 million bushels for 2006-2007, while farm corn price expectations remain in the same $3.00- to $3.50-per-bushel range, according to USDA-ERS. U.S. wheat and wheat-by-class balance sheets, as well as price projections of $4.20 to $4.30 per bushel for 2006-2007, were left unchanged.

The soybean ending stocks figure, which was joined by soybean crush and export numbers in the "unchanged" category, represents a 33% increase from the previous year.

"This is very much a non-report for the U.S.," says Don Roose of U.S. Commodities, Inc., in West Des Moines, Iowa.

Much of the future corn and soybean supply depends on what happens south of the Corn Belt, Roose adds. Right now, weather is of utmost concern, in both South America and the southeastern U.S., where growers are expected to plant 15% more corn, according to Roose.

"We'll quickly look at harvest weather in South America and planting weather in the U.S. Those are dominant issues. All eyes are now jumping to the March 30 reports," he says of that day's USDA Grain Stocks and Prospective Plantings reports.

Other factors playing into the milktoast tone of Friday's report are counterbalancing conditions in different parts of the world that yield a number very similar to a month ago. Roose says drought in South Africa has cut corn output there by as much as 2.5 million metric tons. But, more favorable conditions in Argentina have analysts expecting a sizable yield increase there. Yet, most important to U.S. corn stocks, Roose reiterates, is the planting that's currently underway from south Texas to Florida.

"We're counting on a couple million more acres in the south," he says.

Global grain supply and demand is unchanged from a month ago, making Friday's USDA-ERS World Supply and Demand report more of a "non-report" that was quickly seen by analysts as neutral to the U.S. commodities trade.

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