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Corn falls despite USDA data

DES MOINES, Iowa ( U.S. soybean stockpile is not changing, despite strong exports. Corn stocks are falling, according to the USDA's February Supply/Demand estimate Monday.

After reacting positively to the USDA data, the corn market closed lower Monday.

The March corn futures contract settled 1 1/4 cents lower at $4.43. The March soybean futures contract finished 6 cents lower at $13.25. March wheat futures ended 7 cents higher at $5.84 per bushel. The March soymeal futures contract ended $2.50 per short ton lower at $444.20. The March soyoil futures ended $0.17 higher at $38.73.

In the outside markets, the NYMEX crude oil is $0.15 per barrel higher, the dollar is lower and the Dow Jones Industrials are 49 points lower.

Discuss the USDA Report in Marketing Talk.

In its report, USDA pegged the U.S. 2013-14 Soybean stocks, at the end of the marketing year on August 31, at 150 million bushels. That is in comparison to the trade's average estimate of 143 million bushels and the USDA's January estimate of 150 million.

For corn, the USDA sees the U.S. 2013-14 stocks at 1.481 billion bushels vs. the average estimate of 1.606 billion bushels and the USDA's previous estimate of 1.631 billion.

The USDA pegged the 2013-14 U.S. wheat stocks at 558 million bushels compared to the average trade estimate of 602 million bushels and the USDA's previous estimate of 608 million.


On Monday, the USDA estimated world wheat stocks at 183 million metric tons, compared with the average trade estimate of 184.7 million metric tons and the USDA's previous estimate of 185.4 million metric tons.

On soybeans, the world stocks were estimated at 73.0 million metric tons vs. the average trade estimate of 72.4 million metric tons and the USDA's previous estimate at 72.3 million metric tons.

For corn, the USDA estimates world stocks at 157.3 million metric tons vs. the average trade estimate of 159.0 million metric tons vs. the USDA previous estimate at 160 million metric tons.


Dustin Johnson, analyst says the U.S. numbers were the biggest report surprise.  "The USDA is projecting corn carryout below 1.5 billion this year and that caused a rally to new highs in 2014.  The increase of 150 million bushels in export demand is something that could change before the year is over but for now many traders are looking at this report for direction.  This is one of the largest increases to export demand in February WASDE history," Johnson says.

Soybean exports were up 15 million bushels but residual was down 10 million  and imports were up 5 million, he says. "Exports were expected to be higher and there was a lot of air under the market.  Even though this was viewed as bearish the tug of war between large South American production and tight US supplies will likely continue into summer," Johnson says.

Surprisingly, wheat was well under estimates after a sharp increase to exports, Johnson says.  "Wheat has been the weakest product on the board and has a lot of air above the market to retrace it's recent losses," Johnson says.

Mike North, Senior Risk Advisor for First Capital Ag, says the USDA has work to do with ending stocks figures. "
Still untouched though is the corn feed number which still towers over 2012/13 usage by 22%.  This has yet to be addressed," North says.


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