Soybean producers intended to plant 89.557 million acres of soybeans. The soybean acreage intentions came in near market expectations. Soybean planted acres increased by 575 thousand acres over March planting intentions. At the time of the survey in early June, producers indicated that 8.5 percent of the intended soybean acreage is yet to be planted. When compared to March planting intentions in major producing states, the June survey revealed greater soybean acres in many states. The most substantial adjustments came in Iowa (100,000 acres), Missouri (350,000), and Illinois (300,000 acres). Acreage lower than March intentions is reported in North Dakota (500,000 acres), Minnesota (100,000 acres), and Nebraska (100,000 acres).
Soybean harvested acreage is projected at 88.9 million acres, 660,000 acres less than harvested in 2017. Yield potential is highly uncertain at this point in the growing season. Favorable growing conditions throughout the summer could result in the U.S. average yield near 49.5 bushels per acre. At this yield level, 2018 soybean production would be close to 4.4 billion bushels.
June 1 corn stocks came in at 5.31 billion bushels, nearly 77 million bushels larger than last year and 38 million bushels larger than the average trade guess. Estimation of total disappearance during the quarter is 3.58 billion bushels. Despite the size of the livestock herd throughout this marketing year, feed and residual use continue to show disappointing consumption numbers. Estimated third quarter feed and residual use come in slightly lower than last year at 939 million bushels. Estimates of feed and residual use during the first three quarters of the marketing year sits at 4.694 billion bushels. To reach the projected 5,500 million bushels of corn the USDA projects for feed and residual during this marketing year, feed and residual use in the fourth quarter must equal 806 million bushels. Fourth quarter feed and residual use has not exceeded 800 million bushels since the 2005-06 marketing year. Based on current stocks estimate, it appears feed and residual use this year may not reach the projection of 5,500 million bushels and indicates a reduction by the USDA in the next WASDE report on July 12.
The June 1 soybean stocks estimate indicated a record 1.22 billion bushels, up 256 million bushels from last year. Total disappearance for the quarter was approximately 890 million bushels. To meet the current USDA projection for soybean ending stocks, 717 million bushels of use is necessary for the fourth quarter. Despite the continued uncertainty in soybean export markets, June 1 soybean stocks are neutral for soybean prices as soybean consumption maintains a pace to meet USDA projections for the 2017-18 marketing year.
The uncertainty surrounding trade policy and the evolving weather for crop development will continue to dominate corn and soybean prices over the near term. The USDA reports were not supportive for corn prices. Given the current pace of consumption in feed and residual now being experienced, year ending stocks for corn will likely be higher than the 2.102 billion bushels projected by USDA on June 9. In addition, the increase in corn acreage points to adequate supply during the next marketing year. A record June 1 stocks for soybeans combined with a moderate rise in acreage continues to place the focus on China-U.S. trade issues.
Source : farmdocdaily