No real surprises in June WASDE report amidst bearish markets

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The United States Department of Agriculture (USDA) is out with its June World Agricultural Supply and Demand Estimates (WASDE) report.

There were no major surprises in the report, but markets saw another sell-off following its release.

After a number of rain instances in some of the wheat growing zones, the outlook for wheat this month is for larger supplies, domestic use, exports, and ending stocks. Supplies are raised on increased production, which is up 44 million bushels to 1,781 million. Winter wheat took one of the higher jumps, with a forecast at 1,201 million bushels on an increase in harvested area.

The 2022/23 wheat export forecast was raised 25 million bushels to 800 million, due to the recent decline in U.S. commodity prices making exports more competitive in international markets. The projected season-average farm price (SAFP) is lowered $0.25 per bushel to $10.50 on declines in futures and cash prices.

Around the world, EU wheat production is lowered 2.0 million tons to 134.1 million, as ongoing dry weather lowered yield prospects primarily in Spain, Italy ,and Germany. Ukraine production is lowered 2.0 million tons to 19.5 million on a reduction in harvested area.

For corn in the U.S, the report was bearish — projecting heavier ending stocks at 70 million bushels.

Foreign corn production took a downturn, with reductions for Russia, and the EU, and Kenya partially offset by an increase for Paraguay.

Soybean production is down as well, with a projection of 4.5 billion bushels, down 135 million on lower harvested area.

The soybean yield forecast is unchanged at 51.5 bushels per acre, and crush is reduced 10 million bushels, reflecting a lower soybean meal export forecast. Ending stocks for 2022/23 are projected at 230 million bushels, down 50 million from last month.

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