Markets rally as USDA pulls back corn production, raises export expectations

The November WASDE report from the United States Department of Agriculture led to some green on the screen on Tuesday as markets reacted positively to the news of higher corn exports and lower than predicted production.

For U.S corn, production is pegged at 14.507 billion bushels, down 215 million from the last report, following a reduction in yield to 175.8 bushels per acre. The export number was bumped 325 million bushels to 2.650 billion โ€” a record amount, if it happens. Chinese corn imports are pegged at 13 million tonnes, up from 7 million in the October report.

“With supply falling and use increasing, corn ending stocks for 2020/21 are down 465 million bushels to 1.7 billion, which if realized would be the lowest since 2013/14,” the report states.

Globally, the corn production forecast is down, including a projection that Ukraine may have the smallest corn crop since 2012/13.

For soybeans, the reported 2020/21 production is forecast at 4.17 billion bushels, down 98 million on lower yields, overall. Major soybean producing states, including Illinois, Iowa, Indiana, Ohio, and Nebraska, all had smaller than expected soybean crops.

Global oilseed production is also forecasted to drop by 5.6 million tons to 473.3 million tons, mainly on lower soybean crops for Argentina and India and lower sunflower seed production in Ukraine and Russia, according to the report.

As of press time, grain futures were showing double-digit positive price moves based on the report.

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