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USDA raises new crop U.S. corn, soybean ending stocks

Higher production estimates have led to higher new crop U.S. corn and soybean ending stocks projections.

Demand outlooks were steady to higher for both beans and corn, but not enough to cancel out the effects of those production expectations, pressuring the USDA’s average farm price outlooks. The new marketing year for corn and soybeans gets underway September 1st.

The USDA tightened the balance sheet for U.S. wheat because of a smaller domestic production guess and bigger export estimate, as the USDA anticipates drought related losses in parts of the European Union.

The USDA’s next set of supply and demand estimates is out September 12th.

Breakdown of selected U.S. and world supply and demand tables:

2018/19 U.S. wheat ending stocks are seen at 935 million bushels, compared to 985 million in July and 1.1 billion at the end of 2017/18. The USDA lowered the production guess slightly, taking the total supply to 3.112 billion bushels, and raised food use slightly, but cut feed and residual use, taking domestic use to 1.152 billion bushels. Exports were increased 50 million bushels to 1.025 billion, for total use of 2.177 billion bushels. The average 2018/19 farm price is estimated at $4.60 to $5.60 per bushel, compared to $4.50 to $5.50 a month ago and $4.73 for the previous marketing year.

2017/18 U.S. corn ending stocks came out at 2.027 billion bushels, unchanged from last month and down from the 2.293 billion at the end of the last marketing year. There were no changes to the balance sheet. The average 2017/18 farm price is estimated at $3.35 to $3.45 per bushel, compared to $3.30 to $3.50 in July and $3.36 for 2016/17.

2018/19 U.S. corn ending stocks are projected at 1.684 billion bushels, compared to 1.552 billion a month ago. With a higher production estimate, total supply is seen at 16.664 billion bushels. The USDA increased expectations for feed and residual use, pushing domestic use to 12.630 billion bushels, and raised the export guess 125 million bushels to 2.350 billion, taking total use to 14.980 billion bushels. The average 2018/19 farm price is estimated at $3.10 to $4.10 per bushel, compared to $3.30 to $4.30 last month.

2017/18 U.S. soybean ending stocks are estimated at 430 million bushels, compared to 465 million in July and 302 million in 2016/17. There were no changes to the supply side of the outlook. On the demand side, the USDA increased domestic crush use and exports, putting total use for the soon to end marketing year at 4.286 billion bushels. The average 2017/18 farm price is estimated at $9.35 per bushel, unchanged from a month ago and down from the average of $9.47 in the prior marketing year.

For the old crop soybean products, whose marketing year runs through the end of September, the USDA lowered soybean oil ending stocks, anticipating higher food, seed, and industrial use, but lowered the average price estimate a quarter cent to $.30 per pound. The USDA raised soybean meal production, slashed domestic use, and increased exports, leaving ending stocks unchanged from a month ago. The average farm price was also unchanged from last month at $350 per short ton.

2018/19 U.S. soybean ending stocks are expected to be 785 million bushels, compared to 580 million last month. With lower beginning stocks and higher production, the total supply is now pegged at 5.04 billion bushels. The USDA increased crush, export, and residual use expectations, putting total use at 4.256 billion bushels. The average 2018/19 farm price is estimated at $7.65 to $10.15 per bushel, compared to July’s range of $8 to $10.50.

For new crop soybean products, the USDA lowered soybean oil beginning stocks and raised production, taking total supply up 30 million pounds on the month to 26.266 billion. Domestic disappearance was up 200 million pounds to 22 billion on an increased food, feed, and other industrial use projection, putting total use at 24.2 billion pounds, and leaving ending stocks at 2.066 billion. The average 2018/19 farm price for soybean oil is estimated at $.28 to $.32 per pound, unchanged from a month ago. New crop bean meal production was up on the month, but the USDA raised exports, leaving ending stocks unchanged at 400,000 short tons. The average 2018/19 farm price for soybean meal is $295 to $335 per short ton, compared to $315 to $355 last month.

2018/19 world wheat ending stocks are projected at 258.96 million tons, compared to 260.88 million in July. Production was lowered to 729.63 million tons with reduced expectations for the U.S., European Union, and Brazil cancelling out anticipated increases in Pakistan, Russia, Kazakhstan, and the dozen smaller former Soviet states. Domestic feed use is pegged at 138.45 million tons, compared to 142.33 million last month, and exports are seen at 183.87 million tons, compared to 185.45 million a month ago.

2018/19 world corn ending stocks expected to be 155.49 million tons, compared to 151.96 million last month. Production was hiked to 1.061 billion tons on increased expectations for the U.S., Ukraine, and dozen smaller former Soviet states offset reductions for Brazil, South Africa, and the European Union. Domestic feed use is estimated at 671.40 million tons, compared to 666.66 million a month ago, and exports are projected at 159.61 million tons, compared to 157.79 million in July.

2018/19 world soybean ending stocks are pegged at 105.94 million tons, compared to 98.27 million a month ago. The USDA raised global production to 367.1 million tons, with higher outlooks for the U.S. and European Union. The domestic crush is seen at 308.67 million tons, compared to 309.31 million in July, and exports are estimated at 157.96 million tons, compared to 157.32 million last month. The USDA left South American production and exports unchanged, along with Chinese imports.

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