July WASDE Report: The Big Changes to Watch

The USDA's highly anticipated July World Agricultural Supply and Demand Estimates (WASDE) report is on the horizon, triggering speculation about potential changes to yield estimates for corn, soybeans, and wheat. Although the July WASDE report typically avoids altering yield estimates, the prevailing drought conditions across the Midwest may prompt USDA to revise the corn yield.  

Scheduled for release on Wednesday, July 12, alongside the Crop Production report from the National Agricultural Statistics Service (NASS), these reports will provide crucial updates on the winter wheat crop estimates and yield adjustments. 

Market observers are particularly interested in whether USDA will adjust the corn yield estimate. The last notable alteration occurred in 2012, during a period resembling the current U.S. Drought Monitor conditions. USDA made a significant early move by reducing the corn yield from 166 bushels per acre (bpa) to 146 bpa. While USDA may lower the corn yield estimate this year, the expected adjustment is unlikely to match the drastic change seen in 2012.

Dow Jones' survey of 14 analysts aligns with this view, projecting a reduction from 181.5 bpa to 175.8 bpa. The anticipated corn crop size stands at 15.149 billion bushels, based on USDA's planting estimate of 94.1 million acres. 

The report also takes into account USDA's June 30 findings on corn stocks, revealing lower figures than anticipated. Analysts predict a reduction in old crop ending corn stocks from 1.452 billion bushels (bb) to 1.406 bb, considering the slower pace of export sales in 2022-23. 

For soybeans, USDA will work with a lower-than-expected planting estimate of 83.5 million acres for 2023. Dow Jones' survey suggests a slight decrease in the yield estimate, leading to a new soybean production estimate of 4.250 billion bushels. Alternatively, USDA may maintain the soybean yield estimate at 52.0 bpa, resulting in a new-crop estimate of approximately 4.30 billion bushels. 

While minimal changes are expected for wheat estimates globally, NASS's Crop Production report will shed light on U.S. winter wheat crop estimates. Dow Jones anticipates a slight adjustment in old-crop ending wheat stocks, while USDA's estimate for new-crop ending wheat stocks is expected to decrease slightly.