Numbers for corn and wheat came in lower than expected
By Diego Flammini
An anticipated USDA report offered some positive news for U.S. growers.
The USDA’s Quarterly Grain Stocks report included figures that came in lower than some analysts expected.
“Market expectation were for the report to be tight versus March 2019 because of the smaller crop last year,” said Abhinesh Gopal, a commodity analyst with Farms.com Risk Management. “But the stocks report came out with tighter numbers than average trade expectations.”
The USDA recorded corn’s quarterly stocks at 7.9 billion bushels, lower than the 8.1 billion bushels in pre-report estimates.
Soybean stocks came in a 2.25 billion bushels, slightly higher than the 2.24-billion-bushel figure in pre-report numbers. And wheat stocks were 1.41 billion bushels compared to 1.43 billion before the report’s release.
“It’s price friendly on paper,” Gopal said. “The lighter-than-expected corn stocks figure as we entered the critical period of March, which is when the demand destruction on account of lower ethanol demand and lower gasoline demand happened, means we are not in as fire a situation as feared.”
The stocks report was one USDA document that supported crop prices.
The Prospective Plantings report also held good news for farmers, Gopal said.
“Prices were influenced not just by the stocks report but by the outside market action and the Prospective Plantings report, which showed a huge U.S. corn acreage expected for 2020 at 97 million acres,” he said.
The report projected soybean acres to be around 83.5 million acres, up 10 percent from last year, and wheat acres at 44.7 million, down 1 percent from 2019.
In terms of marketing opportunities, Gopal suggested keeping an eye on basis at local elevators.