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Trade Sees USDA Data As Mixed

DES MOINES, Iowa (— The U.S. stocks of corn and soybean crops continue to build slightly, according to the USDA Wednesday.

As a result of USDA making little changes to the U.S. ending stocks figures from February, the CME Group’s corn futures market initially moved up slightly, soybeans traded 2 cents higher, and wheat up 1 cent. However, at the close May corn futures settled 1 cent lower at $3.59 1/2 while May soybean futures ended 1 1/4 cents higher at $8.85 3/4. May wheat futures closed 3 cents higher at $4.68 1/4. May soymeal futures finished $1.50 per short ton lower at $271.30. May soyoil futures ended $0.60 higher at $31.74.  

In the outside markets, the Brent Crude oil market is $1.59 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 6 higher.

USDA data
In its March Supply/Demand and Crop Production reports, the USDA pegged U.S. corn 2015/16 ending stocks at 1.83 billion bushels, compared with the trade’s expectations of 1.854 billion bushels, and the agency's February estimate of 1.837 billion bushels. 


For soybeans, the USDA estimates 2015/16 ending stocks at 460 million bushels vs. the trade’s expectations of 452 million and the February estimate of 450 million. And for U.S. 2015/16 wheat ending stocks, the government pegged them at 966 million bushels vs. the trade’s expectations of 975 million bushels and its February estimate of 966 million. 


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Jason Roose, U.S. Commodities, says that there are no real big surprises on this report. "No change in South America production, slightly supportive, no new bearish news, eyes now on spring weather and acres numbers."

Peter Meyer, PIRA Energy senior market analyst agrees that there are no surprising numbers for a March WASDE. "The World Board mailed it in. Nothing of note in either U.S. demand or South America's production as the majority of these categories were left unchanged.”

Meyer adds, “The biggest question that came out of the report was how patient the record short positioning will stay with unchanged numbers. Obviously, the bears needed some additional ammo but none was forthcoming this month.” Critical pieces of information, in the form of the Quarterly Stocks and Prospective Plantings, will be released at the end of the month. “Until then, traders and producers will be left with a barrage of weather predictions for both planting and critical growth months,” Meyer says.

Sal Gilbertie, Teucrium Trading owner, says that the report does confirm some El Niño related wheat production issues in India and Australia.

“With no real deviations from trade expectations in today’s report, the large speculative short positions across the grain markets as reported by the CFTC may not find much support to spur future profits on the downside, and normal springtime concerns could well stimulate some short covering or even outright buying before the all-important March 31 planted acreage intentions.”

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