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USDA Data Seen as Bearish for Farm Markets

Bigger U.S. Stocks, Bigger World Crops projected.

DES MOINES, Iowa -- On Tuesday, the U.S. will have even larger soybean and wheat ending stocks than the trade expected, and South America’s crop production keeps getting bigger.

In its April Supply/Demand Report, the USDA left the U.S. corn stocks unchanged at 2.32 billion.

As a result, the CME Group’s farm futures prices closed mostly weaker but off their daily lows.

At the close, the May corn futures settled ½¢ lower at $3.66½, while December futures finished ¼¢ lower at $3.90½.

May soybean futures finished 2½¢ lower at $9.39¼.

May wheat futures closed 4½¢ higher at $4.33¼.

May soy meal futures settled 20¢ per short ton higher at $309.30. May soy oil futures closed 0.28¢ lower at 31.07¢ per pound. 

In the outside markets, the Brent crude oil market is 21¢ per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 45 points lower.

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Jack Scoville, The PRICE Futures Group’s senior market analyst, says there is nothing in the U.S. data that is really out of line with expectations.

“Corn actually is a little below guesses and beans dead on. Wheat a little higher. But the world data is big, especially for beans, and I think that is driving the markets lower,” Scoville says. 

He adds, “The beans and corn increased in both Argentina and Brazil are the ticket to the price action here, and the big beans are the big thing. World ending stocks up a lot, reflecting slightly underestimated production in the U.S. and the big jumps and Brazil and Argentina and perhaps a reduction in demand maybe from China.” 

Jason Roose, U.S. Commodities, says that this report means more price pressure for ag commodities.

“No real big surprises on today’s monthly report. What this report continues to do is confirm that there is no shortage of grain. Larger South America corn and bean crop increasing the world ending stocks for the grains adding pressure to the prices,” Roose says.

 

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