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Report catches market off guard

Agriculture.com Staff 10/13/2006 @ 2:41pm

This month's Supply and Demand report had some surprises and caught the market off guard. The biggest surprise probably came in the corn market, where carryout was dropped 17.5% from an average pre-report estimate of 1.207 billion bushels down to 996 million bushels.

Soybeans confirmed a large carryout but were less than expected at 555 million, versus an average estimate of 588 million. For wheat, supplies continue to tighten with world carryout down 7 million metric tonnes at 119.3 million, down from last month's 126.3 million.

The USDA is projecting a 56 million metric tonne bean crop from Brazil, in line with last year's 55 million. In addition, Argentina's crop estimate is 41.3 million metric tonnes, which compares to 40.5 from last year.

All three major row crop commodities received a bullish reaction from the report with sharp gains noted in the corn and bean markets. Wheat prices may have already factored in much lower projected world carryout.

If you have any questions or comments, please contact Top Farmer at 1-800-TOP-FARM, ext. 129.

This month's Supply and Demand report had some surprises and caught the market off guard. The biggest surprise probably came in the corn market, where carryout was dropped 17.5% from an average pre-report estimate of 1.207 billion bushels down to 996 million bushels.

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