USDA: Corn yield = 146; focus back on weather
U.S. farmers will raise a corn crop of around 146 bushels/acre this year, but numbers show demand rationing is already underway. But, is that happening at a quick enough pace to keep up with what's going to end up a weather-shortened crop?
In its monthly WASDE and Crop Production reports released Wednesday morning, USDA dropped both yield and usage for this year's corn crop. Though yields were cut to 146 bushels/acre, exports are seen 300 million bushels lower and feed usage down 650 million bushels from a month ago, both numbers that show trading partners and end-users are already trimming corn usage in recognition of a marketplace that has a lot of upside potential.
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"We're looking at how much demand destruction we're going to have. What number is going to do it?" says U.S. Commodities trader and market analyst Don Roose. "The supply continues to shrink, and so does demand. But, is it shrinking enough? This is bullish from a yield standpoint, and now the question is can we do the job on rationing?"
Now, traders say the focus will turn immediately back to Mother Nature and what she's doing to the crop. "It's a bullish report, but now the focus is back on the weather," says Agriculture.com Market Analyst, floor trader and Marketing Talk veteran contributor Scott Shellady.