The United States Department of Agriculture (USDA) has released the latest World Agricultural Supply and Demand Estimates (WASDE) report, and it holds steady no changes to U.S. corn and soybean supplies. The report pegs the U.S. ending stocks at 1.342 billion bushels for corn, 210 million bushels for soybeans, and 598 million bushels for wheat. This article will explore the WASDE report’s details in depth, including information on global production and market reactions.
U.S. 2022/2023 Endings Stocks
The WASDE report shows that the U.S. corn ending stocks for 2022/2023 remain at 1.342 billion bushels, reflecting no change from March. This figure exceeds the trade’s prediction of 1.319 billion bushels. Soybean supplies show 210 million bushels, in line with the March estimate and above the trade’s prediction of 198 million bushels. Wheat also shows an increase in ending stocks, shifting from March’s estimate of 568 million bushels to 598 million bushels.
Global 2022/2023 Ending Stocks
USDA pegged the world’s corn ending stocks at 295.4 million metric tons (mmt), just below the trade’s prediction of 295 mmt and last month’s estimate of 296.5 mmt. There have been no changes to soybean ending stocks compared to the March estimate, with the forecast still at 100.3 mmt, just exceeding the trade’s estimate of 98.6 mmt. Regarding wheat, the USDA estimated world-ending stocks at 265.1 mmt, below the trade’s estimate of 267.1 mmt and the March estimate of 267.2 mmt.
2022/2023 Argentina and Brazil Crop Production
According to the WASDE report, Argentina’s corn production is pegged at 37 mmt, just below the trade’s prediction of 37.1 mmt and last month’s estimate of 40 mmt. Brazil’s corn production forecast estimates 125 mmt, similar to last month’s prediction of 125 mmt and slightly-reduced than the trade’s estimate of 126.1 mmt. For soybeans, Argentina is expected to produce 27 mmt, whereas Brazil’s soybean production forecast is estimated at 154 MMT.
Trade Reaction
Naomi Blohm, Senior Market Advisor with Total Farm Marketing, stated that the USDA’s latest report was perplexing to the market. The USDA made no changes to U.S. corn or soybean carryout numbers, opting to see the development of Mother Nature. Al Kluis, Managing Director of Kluis Commodity Advisors, said that while the South American crop production numbers came close to trade estimates, it is anticipated that the Argentine crop will fall lower in future reports. Additionally, Nick Tsiolis, Founder of Farmer’s Keeper, stated that the surprise was Argentina’s massive cuts to production estimates. Despite this, the market showed worse soybean demand for U.S. beans and Brazil’s production increased.
The USDA’s latest WASDE reports have been a surprise to the market, with no changes made to U.S. corn and soybean carryout numbers. Given that the market is expecting lower production, it will be interesting to see where this trend goes in the coming months.