U.S. Corn, Soybean Yield Estimates Unchanged, USDA Reports

The USDA's latest estimates of U.S. corn and soybean ending stocks remain burdensome.

As a result, the markets traded mostly lower, following the 11:00 a.m. CT release of the USDA July Supply/Demand Report.

At the close, the Sept. corn futures finished 11 1/2¢ lower at $3.37 3/4. Dec. corn futures finished 12 1/2¢ lower at $3.44 1/4.

Aug. soybean futures closed 10 3/4¢ lower at $8.90. November soybean futures finished 9¢ lower at $8.85.

Sep. wheat futures closed 9¢ higher at $5.39.

Aug. soymeal futures closed $5.30 per short ton lower at $300.10. Aug. soy oil futures finished $0.08 cent lower at 28.84¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.92 per barrel higher at $40.54. The U.S. dollar is lower, and the Dow Jones Industrials are 333 points higher.

U.S. Yield

In its report, the USDA pegged the U.S. corn yield at 178.6 bushels per acre, vs. the trade's expectation and the USDA's June estimate of 178.6 bu./acre.

For soybeans, the U.S. average yield estimate is pegged at 49.8 bu./acre vs. the trade's expectation of 50.0 bu./acre and the June USDA estimate of 49.8 bu./acre.

Corn Ending Stocks

In its report, U.S. old-crop corn ending stocks were pegged at 2.24 billion bushels vs. the trade's expectation of 2.27 billion and the USDA's June estimate of 2.10 billion.

For 2020/2021, U.S. corn ending stocks are estimated at 2.64 billion bushels vs. the trade's expectation of 2.73 billion and the USDA's estimate in June of 3.32 billion.

Soybean Ending Stocks

The U.S. old-crop ending stocks were estimated at 620 million bushels vs. the trade's expectation of 585 million and the USDA's June estimate of 585 million.

For 2020/2021, the U.S. soybean ending stocks were estimated at 425 million bushels vs. the trade's expectations of 424 million bushels and the USDA's June estimate of 395 million.

Wheat Ending Stocks

The 2020/21 U.S. wheat ending stocks are estimated at 942 million bushels vs. the trade's estimate of 950 million and the USDA's June estimate of 925 million.

Trade Response

Jason Roose, U.S. Commodities, says that today's report is not intended to be a market mover.

"With yields left unchanged for corn and soybeans from last month's report and lower ending stocks for corn and soybeans with lower acres as the main factor for the new crop, lower ethanol production and lower feed usage will continue to be a negative for the corn with supplies at a surplus. Updated forecasts will still have an impact on price discovery," Roose says.

Jack Scoville, PRICE Futures Group, says that today's USDA reports were bearish on the demand side for corn.

"Supply side for corn ad beans adjusted due to the changes in planted area, so nothing too exciting there. But corn demand got cut quite a bit. Even so, the ending stocks are below trade expectations," Scoville says.

For soybeans, the world data saw increased production from Brazil, a negative surprise.

U.S. wheat production is down more than expected and a bullish surprise, Scoville says.

"Ending stocks levels in general are below the trade expectations and should support prices," Scoville says.

Sal Gilbertie, Teucrium Trading, says that today's USDA report shocked no one.

"No surprises, with the USDA accounting for the June Stocks and Acreage reports in today's WASDE release. Of note is the projected decline in soybean stocks of almost 200 million bushels from this season to next, which leaves little margin for yield declines this year. The weather, as it affects the U.S. soybean crop, bears close watching from this point forward," Gilbertie says.