Rounding out a year full of surprises, the United States Department of Agriculture’s (USDA) took the mostly predictable route with its final World Agricultural Supply and Demand Estimates (WASDE) report of the year on Thursday.
The major figures in the December report were largely in line with the trade’s expectations.
Soybean ending stocks were down 15 million bushels to 175 million bushels, with exports unchanged. If these ending stocks are realized, the USDA says this would be the lowest since 2013/14. Good news on the soybean crushing side however — strong crush margins have led to a record early season crush.
The corn supply and use outlook for this month is unchanged from the previous report.
The USDA essentially “kicked the can down the road” in today’s report, says Brian Voth, CEO of IntelliFarm.
“There were only minimal changes in South American production estimates (Brazil corn and beans unchanged, Argentine corn and beans both down 1 mmt),” notes Voth. “On the U.S. side, they left the corn carryout unchanged from last month, with only a 15 million bushel increase in soy crush bringing soybean carryout down to 175 million bushels versus the trade estimate of 163 million bushels.”
The bottom line is the USDA seems to be okay with its current demand estimates, says Voth.
In addition to South American production, the spotlight remains on Chinese demand.
“Chinese officials continue to downplay their need for corn, keeping their own import estimates unchanged, likely a play to keep a lid on prices, but no one believes them given actual shipments over the past few months,” notes Brennan Turner, CEO of FarmLead.
As for wheat, U.S. ending stocks are projected down 15 million bushels at 862 million — lower than expected and 16 percent lower than last year “thanks to a healthy increase in demand from Asian buyers and the subsequent reduction in global ending stocks,” says Turner.
Check out the tweets below for some more highlights:
USDA 2020/21 US Ending Stocks:
– #Corn unchanged
– #Soybeans down 15 million bushels to 175 with increase in crush demand
– #Wheat ending stocks down 15 million bushels. pic.twitter.com/47es2R4X78— Matthew Pot (@MatthewPot) December 10, 2020
USDA reduced the 2020/21 harvests of #corn and #soybeans in #Argentina by 1 mmt each. The 19/20 Argy soy harvest was also trimmed from 49 mmt. #Brazil crops were unch from November estimates. pic.twitter.com/thtaRHOqoZ
— Karen Braun (@kannbwx) December 10, 2020
USDA raises U.S. #soybean crush by 15 million bushels, dropping the same from ending stocks. Exports left unchanged for now. January 12 quarterly stocks report could be big for #soybeans. #oatt
— Arlan Suderman (@ArlanFF101) December 10, 2020