November Crop Supply and Demand Estimates

The reports we have been waiting for over a month (World Agricultural Supply and Demand Estimates report and Crop Production) were finally released mid-day Friday and brought about a few surprises. Projected 2013 soybean production in the U.S. was revised higher from September’s 3.03 billion bushels to 3.26 billion bushels, slightly higher than pre-report estimates of 3.22 billion bushels. The U.S. corn production estimate was revised up to 13.99 billion bushels this month compared to 13.84 in September, but lower than pre-report expectations of 14.03. Corn yield was estimated to be 160.4 bu/acre versus 155.3 reported in September and 159.2 expected. Continue reading “November Crop Supply and Demand Estimates”


September Supply and Demand Report Recap


After all of the news from crop scouts in the corn belt a few weeks ago, the much anticipated September WASDE report has been released. One of the bigger surprises came with the estimated corn yield. Pre-report estimates were expecting a reduction in corn yields from last month on news that the Iowa corn crop was not as good as previously thought. But, the USDA actually revised yields 0.9 bu/acre higher with a great crop in the South and the Eastern Corn Belt more than offsetting lower yields further West. The increase in yields will result in a record 13.843 billion bushels in corn being harvested this fall. Even with an increase of 55 million bushel in demand, ending stocks were revised up 15 million bushels from last month. Mississippi is expected to top last year’s record corn yields with a 170 bu/acre yield.


With reports coming out a few weeks ago of poor pod counts, it is unsurprising that the USDA revised soybean yields down by 1.4 bu/acre to 41.2 bu/acre. This figure is in line with most pre-report estimates. The lower production is partially offset by decreased crush and exports, however ending stocks were still revised down by 70 million bushels from last month to 150 million bushels. This is only 25 million bushels more than last year’s ending stocks.


Stocks of old crop (2012) cotton increased 100,000 bales based on end of marketing year data (the marketing year closed July 31, but balance sheets are still being updated). This pretty much flowed through into the new crop (2013) revised stocks number, which also increased 100,000 bales to 2.9 million total. This is not to say that no changes were made to the 2013 supply and demand projections. The U.S.’s 2013 yield was lowered 17 pounds per acre to 796 (Mississippi’s yield forecast was increased 19 pounds per acre to 1,009) due to lingering drought in West Texas which has kept a lid on crop condition ratings the past number of weeks. This pulled total 2013 production estimates down to 12.9 million bales from 13.05 projected last month (harvested acres were increased by 80,000 to 7.78 million as more information comes in from sources such as Farm Service Agency). Exports were lowered by 200,000 bales to 10.4 million due to the slow pace of sales thus far in the current marketing year.

Globally, projected ending stocks were raised by 960,000 bales largely due to increases from Brazil and India, and are currently projected at 94.73 million. Brazilian ending stocks rose 190,000 bales from last month’s estimate (currently pegged at 6.23 million bales) and India’s projected ending stocks increased 600,000 bales (to 9.39 million from last month). Despite China not seeing many revisions with their crop or ending stocks, they continue to hold the lion’s share of the stocks (62% of total world stocks).

August Supply and Demand Report Recap


Soybeans also saw bullish news in the August WASDE report. Both planted and harvested acres were revised down by half a million acres from last month’s projections. Soybean yields were also revised down by 1.9 bu/acre to 42.6 bu/acre. The yield estimate was more than a bushel below what many analysts were expecting. The lower acres and yields for soybeans add up to a 165 million bushel decrease in the soybean supply compared to last month, significantly lower than expected. Exports were revised down 65 million bushels and crush was revised down 20 million bushels resulting in ending stocks of 220 million bushels. The ending stocks are 75 million bushels lower than last month’s estimate and 42 million bushels lower than expected. The bullish report has given soybean markets a significant boost today with September soybeans finishing up 38 cents/bu on the day. Continue reading “August Supply and Demand Report Recap”

Crop Market Update: Week Ending Jul 12, 2013

Warm, dry conditions in the Corn Belt along with Thursday’s WASDE report have been the biggest market drivers this week. Corn production was revised lower in the July WASDE report on lower expected harvested acres; however ending stocks were revised up 10 million bushels from last month’s estimate to 1.87 billion bushels. Nearby September corn futures were down sharply on the day but 20 cents higher on the week. The U.S. and Mississippi corn crops both look good at this point, with 68% of the U.S. crop and 66% of the Mississippi crop rated good or excellent, but hot, dry weather is expected over the next week in parts of the Corn Belt at the same time a significant portion of the corn crop in the area is expected to begin silking. Soybean ending stocks were estimated at 295 million bushels in the latest WASDE report, about 25 million bushels more than expected. Soybean conditions are looking great in Mississippi as well as across the country with 74% of the Mississippi crop rated good or excellent and 77% of the U.S. crop in the same category. August soybean futures closed down sharply on Friday, but were 16 cents higher on the week. While the USDA has been positive about the outlook of both the corn and soybean crop, the market seems to still have a weather premium in response to the planting delays earlier this spring. While the warm, dry week ahead could impact corn yields, soybeans should not be impacted much for at least another couple of weeks, bringing plenty of opportunity for rain showers to pass through. The winter wheat crop continues to look better than expected with the USDA boosting expected yields by 1.6 bu/acre over last month. However, ending stocks were revised 83 million bushels lower, mostly as a result of increased export sales. acreage is reported as 2% higher than the previous estimate as well. September wheat futures closed 21 cents higher on the week.

Small Grains Prices ($/bu except were noted)

July 5, 2013

July 12, 2013


Nearby Corn Futures




Mississippi Corn*




Nearby Soybeans Futures




Mississippi Soybeans*




Nearby Chicago Wheat Futures




Mississippi Wheat*




Sep Rough Rice Futures ($/cwt)




*Mississippi prices are average July 11, 2013 prices from Greeneville, Belzoni, Greenwood, and Indianola.

U.S. Cotton ending stocks for the upcoming year were projected at 2.90 million bales yesterday (Jul 11) by USDA. Production was unchanged from last month despite a decrease in projected harvested acres as yield was raised. Lackluster exports continue to be a drag on the price, but a few days of a weaker U.S. currency (on Mon, Wed, and Thu) did attempt to provide support.

Cotton Prices (cents/pound)

June 21, 2013

July 12, 2013


Oct Cotton Futures




Dec Cotton Futures




South Delta Cotton Quote




Note: Futures prices are from ICE and cash quote is from USDA, AMS

July Supply/Demand Estimates Recap


The 2013/14 crop saw a few changes from last month’s report should be considered slightly bearish even as the market moved higher. Planted acres were revised up 0.6 million acres from last month to reflect the June Acreage report. Harvested acres were revised up by 0.7 million acres while yield estimates remained the same. Soybean production was estimated to be 3.4 billion bushels, about 30 million bushels higher than the June estimate due to the higher acreage number. Soybean use also remained unchanged with ending stocks estimated to be around 295 million bushels. Most pre-report estimates were expecting a slight increase in ending stocks, even so the USDA estimate was 25 million bushels higher than analysts thought. As with corn, soybeans are trading higher on the day, shrugging off the bearish report with weather conditions worsening in a few important soybean-producing states.

Soybeans (incl. Crush) 2012-2013 Marketing Year 2013-2014 Marketing Year
Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report
Planted Acres (mil. ac.) 77.20 0.0% 2.9% 77.70 0.8% 0.6%
Harvested Acres (mil. ac.) 76.10 0.0% 3.1% 76.90 0.9% 1.1%
Yield (bu/ac) 39.60 0.0% -5.5% 44.50 0.0% 12.4%
Production (mil. bu.) 3,015 0.0% -2.6% 3,420 0.9% 13.4%
Total Supply (mil. bu.) 3,209 0.0% -3.5% 3,560 0.8% 10.9%
All Domestic Use (mil. bu.) 1,382.50 -0.1% -4.5% 1,435.83 0.0% 3.9%
SB Exports (mil. bu.) 1,330.00 0.0% -2.3% 1,450.00 0.0% 9.0%
Crush Exports (mil. bu.) 386.67 0.9% 10.8% 361.67 0.0% -6.5%
Total Use (mil. bu.) 3,085.00 0.0% -2.2% 3,264.00 0.0% 5.8%
Ending Stocks (mil. bu.) 125.00 0.0% -26.0% 3.3% 295.00 11.3% 136.0% 9.3%
Stocks/Use 4.1% 9.0%



The July WASDE report can be considered as slightly bearish. The projected corn production is revised down slightly at 13.95 billion bushels, down 50 million from last month’s estimate. Planted acres were revised up 0.1 million acres from last month, but is consistent with the June Acreage report. Despite this, the decreased production comes from lower expected harvested acres, which were revised down 400,000 acres from last month. Ending stocks were revised up from last month by 10 million bushels, with a 50 million bushel decrease in both feed use and exports. Many industry experts were expecting ending stocks to fall to around 1.87 billion bushels, lower than the reported 1.96 billion bushels. Although this report appears to be somewhat bearish for corn prices, both new and old crop futures were trading higher on the day on news of hot dry weather in the Western Corn Belt.

Corn: 2012-2013 Marketing Year 2013-2014 Marketing Year
Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report
Planted Acres (mil. ac.) 97.2 0.0% 5.8% 97.4 0.1% 0.2%
Harvested Acres (mil. ac.) 87.4 0.0% 4.0% 89.1 -0.4% 1.9%
Yield (bu/ac) 123.4 0.0% -16.2% 156.5 0.0% 26.8%
Production (mil. bu.) 10,780 0.0% -12.8% 13,950 -0.4% 29.4%
Total Supply (mil. bu.) 11,929 0.1% -11.7% 14,709 -0.6% 23.3%
All Domestic Use (mil. bu.) 10,500 0.5% -4.4% 11,500 -0.4% 9.5%
Exports (mil. bu.) 700 0.0% -54.6% 1,250 -3.8% 78.6%
Total Use (mil. bu.) 11,200 0.4% -10.6% 12,750 -0.8% 13.8%
Ending Stocks (mil. bu.) 729.0 -5.2% -26.3% 1.0% 1,959.0 0.5% 168.7% 4.5%
Stocks/Use 6.5% 15.4%



New crop cotton stocks were raised to 2.9 million bales from last month’s projection of 2.6, largely due to increased carry-over from the 2012/13 marketing year. Current marketing year exports have been below the needed pace for some time and especially since last month’s supply/demand report. As a result, USDA lowered the estimate for 2012/13 cotton exports from 13.6 million bales last month to 13.3 in the current report. This was the only change to old crop cotton and led to higher carry-over into the 2013/14 crop year. The new crop projections showed higher planted acres (from the June Acreage report) but smaller acres harvested (with an expected increase in Texas abandonment). Yield was raised to equally offset the lower harvested acres and thus production was unchanged (interpret this as: those abandoned acres in Texas would have been low yielding). There were no changes to the projections for 2013/14 crop demand, thus the old crop carry-over was the source of the higher ending stock number for 2013/14 cotton.

Globally, 2013/14 ending stocks were raised 1.85 million bales from last month’s estimate to 94.34 largely as a result of higher stocks in India (up 1.15 mb to 8.39). China’s stocks number was unchanged at 58.93 (62.5% of total world ending stocks).

Cotton: 2012-2013 Marketing Year 2013-2014 Marketing Year
Jul Estimate Change vs Jun Change vs 2011/12 Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report
Planted Acres (mil. ac.) 12.31 0.0% -16.5% 10.25 2.2% -16.7%
Harvested Acres (mil. ac.) 9.37 0.0% -1.0% 7.80 -3.7% -16.8%
Yield (lbs/ac) 887 0.0% 12.3% 831 3.9% -6.3%
Production (mil. bales) 17.32 0.0% 11.2% 13.50 0.0% -22.1% -1.7%
Total Supply (mil. bales) 20.67 0.0% 13.6% 17.41 1.8% -15.8%
All Domestic Use (mil. bales) 3.45 0.0% 4.5% 3.50 0.0% 1.4%
Exports (mil. bales) 13.30 -2.2% 13.6% 11.00 0.0% -17.3%
Total Use (mil. bales) 16.75 -1.8% 11.6% 14.50 0.0% -13.4%
Ending Stocks (mil. bales) 3.90 8.3% 16.4% 2.90 11.5% -25.6% -1.7%
Stocks/Use 23.3% 20.0%



The projected harvested acres for wheat were revised down by a million acres in the July WASDE report. The expected yield was raised by 1.6 bu/acre for a 34 million bushel boost in wheat production. Feed and residual use was revised down by 10 million bushels but exports were increased by 100 million bushels. Domestic wheat use remained unchanged, however exports were revised up 50 million bushels to 975 million bushels. Wheat ending stocks were revised down by 83 million bushels to 576 million bushels, significantly lower than pre-report expectations of 624 million bushels. The bullish report has positively impacted wheat prices with September futures closing up four cents on the day.

Wheat: 2012-2013 Marketing Year 2013-2014 Marketing Year
Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report Jul Estimate Change vs Jun Change vs 2011/12 vs Pre-Report
Planted Acres (mil. ac.) 55.70 0.0% 2.4% 56.50 0.2% 1.4%
Harvested Acres (mil. ac.) 49.00 0.0% 7.2% 45.70 -2.1% -6.7%
Yield (bu/ac) 46.30 0.0% 5.9% 46.20 3.6% -0.2%
Production (mil. bu.) 2,269 0.0% 13.5% 2,114 1.6% -6.8%
Total Supply (mil. bu.) 3,134 -0.1% 5.4% 2,962 0.2% -5.5%
All Domestic Use (mil. bu.) 1,407 1.9% 19.0% 1,311 -0.8% -6.8%
Exports (mil. bu.) 1,009 -0.1% -3.9% 1,075 10.3% 6.5%
Total Use (mil. bu.) 2,416 1.0% 8.3% 2,386 3.9% -1.2%
Ending Stocks (mil. bu.) 718 -3.8% -3.4% 0.0% 576 -12.6% -19.8% -7.7%
Stocks/Use 29.7% 24.1%



Rice: 2012-2013 Marketing Year 2013-2014 Marketing Year
Jul Estimate Change vs Jun Change vs 2011/12 Jul Estimate Change vs Jun Change vs 2011/12
Planted Acres (mil. cwt.) 2.70 0.0% 0.4% 2.47 -5.4% -8.5%
Harvested Acres (mil. cwt.) 2.68 0.0% 2.3% 2.45 -5.4% -8.6%
Yield (lbs/ac) 7,449 0.0% 5.4% 7,330 0.2% -1.6%
Production (mil. cwt.) 199.50 0.0% 7.9% 179.50 -5.3% -10.0%
Total Supply (mil. cwt.) 261.60 -0.2% 3.5% 235.60 -4.3% -9.9%
All Domestic Use (mil. cwt.) 120 0.0% 9.0% 112 -2.6% -6.7%
Exports (mil. cwt.) 109 0.9% 7.3% 95 -3.1% -12.8%
Total Use (mil. cwt.) 229 0.4% 8.2% 207 -2.8% -9.6%
Ending Stocks (mil. cwt.) 32.60 -4.4% -20.7% 28.60 -13.6% -12.3%
Stocks/Use 14.2% 13.8%

June Supply and Demand Report Recap

The United States Department of Agriculture along with the World Ag Outlook Board released their monthly World Agriculutral Supply and Demand Estimates (WASDE) report June 12 around lunch. The report is the second to provide insight on USDA’s projections for the 2013 U.S. crop (new crop). Many expected some alterations due the slow pace to planting as a result of the cool temps and seemingly never ending rain. Continue reading “June Supply and Demand Report Recap”

April World Agricultural Supply and Demand Estimates: Crop Recap


U.S. ending stocks for soybeans remained unchanged in the April World Agricultural Supply and Demand Estimates (WASDE) report at 125 million bushels. Analysts were expecting the ending stocks number to be 137 million bushels, with a range from 107 to 160 million bushels, given the slightly higher quarterly stocks number from last month that indicated demand had been slipping. Soybean crush and exports were both revised up slightly from last month’s report, however those changes were offset by an equal decrease in residual use. Given the offsetting changes, the stocks-to-use ratio remained unchanged at 4.1%. Soybeans futures were largely unaffected by the report with the nearby May contract closing down 2.6 cents at $13.92/bu.


USDA’s April projections of U.S. corn ending stocks for the 2012/13 marketing year were pegged at 757 million bushels, 135 million higher than March projections. This was, however, lower than the average pre-report expectation of 824 million bushels, but following last month’s surprising Grain Stocks number analysts were all over the board with guesses for this month’s WASDE ending stocks (expectations ranged from 625 to 925 million bushels). Much of the difference comes from the 150 million bushel decrease in projected feed and residual use, although industrial use and ethanol use were both revised higher. Corn exports were projected to be 25 million bushels lower compared to last month’s projections. With many traders still recovering from the shock of the stocks report a couple of weeks ago and thus uncertain of where USDA would peg this month’s number, it is unsurprising that corn futures markets had a minimal response to the latest WASDE report. Corn’s stocks versus use currently sits at 6.8% compared to 5.6% last month. Global corn ending stocks were raised to 125.29 million metric tons, with the U.S. and China each accounting for 40% of the increase. May Corn contracts finished up 4.6 cents today at $6.49/bu.


Supply and demand estimates for cotton, while not mundane, were largely in-line with last month’s projections. Interestingly yield was raised 14 pounds per acre to 880 based on information from the final Cotton Ginnings report. This was partially offset by an increase in demand. Exports were raised 250,000 bales to 13.0 million. Ending stocks remained unchanged at 4.2 million bales and the ratio of stocks versus use is now at 25.6% compared to 26.0% last month. Analysts had expected the ending stock number to drop to 4.1 million bales due to the higher pace of exports, but the larger yield appears to have not been accounted for. Global cotton ending stocks were raised to 82.45 million bales, up from 81.74. China’s ending stocks are currently projected at 45.61 million bales, up 1.5 million due to increased imports, and therefore they now account for 55.3% of total world ending stocks. Cotton futures still managed to end the day higher with the nearby May contract ending the day at 85.37 cents/pound, up 0.73, and December ended at 86.57 cents/pound, up 0.78.


Today’s WASDE report appears to have had the most significant impact on the wheat market. Ending stocks for all wheat were revised up 15 million bushels compared to last month at 731 million bushels. The additional bushels are a result of lower feed and residual use than expected, however all other numbers remained unchanged. The higher than expected wheat ending stocks pushed the May wheat contract down 12 cents on the day to close at $6.96/bu


All rice ending stocks projections were raised to 34.1 million hundredweight, up from 29.1 last month. The increase stems from larger long- and medium/short-grain stocks, but with long-grain getting the bigger bump. Domestic demand is the culprit of the higher stocks; with this number decreasing from 125 million hundredweight in last month’s report to 120 projected this month. Rough rice futures ended mildly lower on the day with the nearby May contract closing at $15.675/cwt, down 3 cents/cwt, and the September contract finished at $15.42/cwt, down 4.5 cents/cwt.