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USDA data seen

Agriculture.com Staff 06/10/2009 @ 6:40am

CHICAGO, Illinois (Agriculture Online)--The USDA, in its June Supply/Demand Report released friendly data this morning for the CBOT markets. The CBOT floor traders say the markets should start higher, outside markets may lead the way vs. the report.

Early calls for the commodities are 3-5 cents higher for wheat, 5-10 cents higher for corn, and 10-15 cents higher for soybeans.

For U.S. 2008-09 'old-crop' soybean carryout, the USDA estimated 110 million bushels, below its May estimate of 130 million and below the average analyst estimate of 114 million.

USDA estimated U.S. 2009-2010 'new-crop' soybean carryout at 210 million bushels, vs. its May estimate of 230 million bushels and the average analyst estimate of 211 million.

For corn, the USDA estimated the U.S. 2008-09 carryout at 1.600 billion bushels vs. its May estimate of 1.600 billion and the average analyst estimate of 1.607 billion bushels. Also, the USDA estimated the 2009-2010 U.S. corn carryout at 1.090 billion bushels compared to its May estimate of 1.145 billion, and the average analyst estimate of 1.071 billion.

Meanwhile, the USDA estimated the U.S. 2009-2010 All Winter Wheat production at 1.492 billion bushels vs. its May estimate of 1.502 billion and the average analyst estimate of 1.496 billion.

TRADER REACTIONS

Matt Pierce, a CBOT floor trader with Futures International LLC, says the report doesn't offer any surprises. "A ho-hum report. Old crop stocks in beans lower with no change in new crop numbers for beans. Corn yield dropped by 2 bushels is small so not a worry. Remember last year they lowered corn yield by 5 bu. Follow crude and the US dollar for best direction today," Pierce says.

Jason Ward, Northstar Commodity Investment Co., says nothing bearish in this report unless you look at wheat. "Corn and bean data is friendly and still should continue their up trends," Ward says. Outside markets will continue to direct the grains with US Dollar trends and energy prices more important."

Ward agrees with USDA's estimate of old crop corn at 1.6 billion (unchanged from last month). "I think corn-used-for-ethanol estimate at 3.75 is still 50 million bushels too high, but otherwise no disagreements."

The USDA's new crop corn is bullish with a yield reduction of 2 bushels/acre, Ward says. "When the private forecasters now run that yield through a reduced acreage number expected at the end of June carryout are going to be around 900 million bushels, (a friendly number). No room for yield adversity!!!"

For soybeans, the USDA dropped old crop 20 million bushels is friendly with still 2 crop reports yet to come. "As I said last month, it’s not the bean sales that matter, it is whether we can get them shipped out before China cancels them," Ward says.

No changes to new crop soybeans except for carrying forward the 20 million bushel decline from old crop, Ward says. "USDA did not adjust the bean yield of 42.6 bushels/acre (too early to know yet), but expect that in the next report along with increased bean acres. It isn’t necessarily bearish to Nov 09 though if acres increase because of 1 bushel/acre decline in yield offsets a nearly 2 million acre increase. It’s not the acres, it’s the yield!!"

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