Corn and soybean prices fell Friday following USDA’s release of its latest World Agricultural Supply and Demand Estimates report, which projects a record soybean crop and “smaller supplies, larger exports, and reduced ending stocks” for corn.
In midday trading, November soybeans were at about $10.09/bushel, down 5.2 cents from their Thursday closing price. December corn contracts were down 1.2 cents to about $4.17/bu. after drifting into the $4.15/bu range.
However, Allendale Inc. Chief Strategist Rich Nelson called the latest WASDE a “quiet report” that won’t have much impact on corn and soybean prices.
“The story for this October report is we now have U.S. supply locked in and understood [with] minimal changes for corn and soybeans,” Nelson said. “And certainly the story for corn is that we still have a good demand base to work through these next few months. As far as the soybean side, no changes there, and we're still struggling to meet these export and crush hopes.”
A $25/ton price advantage over Brazilian soybeans will help the U.S. meet export demand, “even though we are still behind in current sales and the crush side is maybe a big question for us,” Nelson said, mentioning the fact that ADM has idled its Des Moines, Iowa, plant through November.
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USDA slightly lowered its estimate for soybean production to 4.582 billion bushels, 4 million less than its September forecast, on a lower yield estimate of 53.1 bu/acre, down from 53.2 bu/acre in September. That total would still be a record.
USDA dropped its soybean supply estimate to 4.9 billion tons, 2 million tons below the September projection. Ending stocks were unchanged at 550 million tons. The season-average price was pegged at $10.80/bu.
The WASDE forecast corn production at 15.2 billion bushels, “up 17 million from last month on a 0.2-bushel increase in yield to 183.8 bushels per acre.”
USDA lowered its estimate for beginning corn stocks to 1.76 billion bushels from September’s 1.81 billion, but that’s still a large increase from last year. Coupled with production and imports, “We're starting this year out with 260 billion bushels of larger supply offered.” Nelson said. “This is still a stout amount, I believe the second-largest total supply we've ever had in the U.S.”
The wheat outlook is for “reduced supplies, larger domestic use, unchanged exports, and lower ending stocks,” the report said. Ending stocks are projected at 812 million, down 16% from last month but still up 17% from the previous year. USDA pegged the average farm price at $5.70 per bushel, unchanged from a month ago.
For rice, the outlook is for “slightly larger supplies, unchanged domestic use and exports, and slightly higher ending stocks. Supplies are raised on higher production as imports are unchanged.”
USDA raised its forecast for red meat and poultry production, with higher beef production more than offsetting decreased pork, broiler, and turkey production. “Turkey production is lowered based on recent production and hatchery data,” the report said. “Total egg production is lowered on recent production data and a slower-than-previously-expected growth rate in the laying flock.”
Egg production for the year was forecast at 9.061 billion dozen (108.7 billion eggs), down from the September forecast of 9.076 billion dozen (108.9 billion), a decrease of 180 million eggs.
USDA lowered its estimate for cotton production by slightly more than 300,000 bales to 14.2 million, “primarily reflecting the damage from Hurricane Helene. Georgia and North Carolina accounted for much of the reduction.”
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